Tax (tds) on service

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34 Points Posted on 26 May 2014

An Indian Company exports the machines to some overseas company through agent.

The agent takes care of installation of the machines there at buyer's company. The agent charges some amount from Indian Company as installation charges.

Now, when paying the installation charges to this agent, do Indian Company need to deduct the tax (TDS) on the installation/ service charges. If so, how much % of TDS will be dedcuted?

 

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On 26 May 2014 at 16:55 Report
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Chartered Accountant
5709 Points Posted on 26 May 2014

I think you may have to deduct tax at 10% under technical services - 194J

capraveenmr.wordpress.com

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On 26 May 2014 at 19:55
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Chartered Accountant
5709 Points Posted on 26 May 2014

I think you may have to deduct tax at 10% under technical services - 194J

capraveenmr.wordpress.com

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On 26 May 2014 at 19:58
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Student as well as Self-employed
3853 Points Posted on 26 May 2014
94C or 94J both can be applicabke in this case, but since installation requires technical skills therefore deduction u/s 94J @ 10% will be more appropriate.
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On 26 May 2014 at 23:45
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34 Points Posted on 27 May 2014

What if we show that this amount is being paid as commission, not installation charges, then do we need to dedcut the tax/tds or not?

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On 27 May 2014 at 09:13
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Student as well as Self-employed
3853 Points Posted on 27 May 2014
you still need to deduct tds u/s 94H of the amt. is more than 5000.
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On 27 May 2014 at 16:08
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Finance
24 Points Posted on 29 May 2014
I think TDS u/s 194H might be applicable only on the part of amount paid as commission to the agent , and no TDS on technical services will be deducted as services are provided to the overseas company buying the machine and not to the company exporting , the agent is merely recovering the amount spend upon installation.
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On 29 May 2014 at 03:52
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32 Points Posted on 22 May 2026

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