Tds 194c

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Mansi devani

44 Points Posted on 23 February 2016

Hello, One of my client facing problem while payment to contractor. Total amount of Bill is Contractor amount Rs.27200 + service tax Rs. 3944 Total Rs.31144/- TDS limit for deducting TDS in 194c is Rs.30000/- there is no specification whether its inclusive service tax or exclusive. Now query is, whether he should deduct tds or not??? bcoz if we consider before service tax, then its below Rs.30000/- Please help me in this matter.

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CA Mehul Chudasama

Chartered Accountant

593 Points Posted on 23 February 2016

Any person responsible for paying any sum to any resident (hereafter in this section referred to as the contractor) for carrying out any work (including supply of labour for carrying out any work) in pursuance of a contract between the contractor and a specified person shall, at the time of credit of such sum to the account of the contractor or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to—

(i) one per cent where the payment is being made or credit is being given to an individual or a Hindu undivided family;

(ii) two per cent where the payment is being made or credit is being given to a person other than an individual or a Hindu undivided family,

of such sum as income-tax on income comprised therein

Serivce Tax Is not the income of the service provider so as per my view limit of Rs. 30000 is without service tax