TDS ... Confused...

TDS always deducted on gross amt including service tax

Yes tds to be deducted when the amount is credited or paid whichever is earlier...

i am sachin woring as a accountant i never motly do the tds but i want know more about tds how it simple to understand for ducting and following procedure becouse i want to go a high pay job so i want to now better accounting

pls give me tha solution becouse i am not so confident i do or not the well accounting in bigeer organisation

Thanks

sachin Tawate

Originally posted by : valji
	TDS always ?? deducted on gross amt including service tax

It is right that TDS to be deducted on GROSS amt incl. Service tax.. BUT not in ALL the cases.

Exception to the above is TDS on RENT u/s. 194 I

A circular has been issued by the CBDT in this regard. In this circular, board has clarified that tax deduction at source (TDS) under sections 194-I of Income Tax Act would be required to be made on the amount of rent paid/payable without including the service tax. [Circular no. 4 dated 28-4-008]

On the basis of  this clarification, it seems that the principle enunciated by this circular is applicable to all the payments made by the assessee and accordingly no TDS is deductible from on the part of service tax whether it is professional's bill or contractor's bill.

But, to settle the issue, CBDT has issued another clarification vide circular F. NO. 275/73/2007IT(B) dated 30-6-2008. In circular CBDT has clarified that the scope of benefit of Circular no. 4 dated 28-4-2008 can not be extended to the payment made under section 194J (Fees for professional and technical services).

Therefore, TDS is to be deducted on the gross amount inclusive of service tax where the payment is being made u/s 194J.

From the reading of both the clarifications, the reasons for two stands in two situations can be discussed as under:

Chapter XVII - Part B - Deduction at source

       Section 194J - Sub Section (1) starts as:

        (1) Any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident any sum by way of—

       xxxxxxx

       Section 194I - the provisions of this section starts as:

       Any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident any income by way of rent, shall…………

       xxxxxxxxx

Section 194J speaks about deduction of tax at source (TDS) on any sum which is paid to the recipient.

But, Section 194I speaks about the deduction of tax at source (TDS) on any income paid as rent.

I hope it will help you guys. Let me know if my interpretation is wrong.

Regards,

sKY.. 

thanks for information