TDS deduction

The ceiling limit is Rs. 120000/- annual. If total rent in a year is excess of this amount then tds on rent is applicable. The Rates in case of machinery, plant or equipment is 10 % plus surcharge & cess.

In case the control on vehicle(Jeep)  is with the owner and he is engaged for the carriage of goods and passengers and all running cost is met by the owner then Tax is to be deducted u/s 194C. However, if the control is with the contractee then the tax is deductible u/s 194I.

ya i am satisfied with what rabnoor said.

tds u/s 194C is applicable & not 194I.

You need not deduct tax at source in this case since it comes within the ceiling of Rs. 1.20 Lacs per annum.

Still if the payment  appears to cross that limit , TDS U/s 194 I  @ 10 % + surcharge and cess is applicable if you are paying the party monthly / weekly / daily  fixed amount.

Since you have said that you are paying Rs. 8500/- per month , Section 194 I is applicable.

Whereas if you are paying the party on the basis of distance covered by the vehicle, then TDS U/s 194 C is applicable and the ceiling limit for that case is either 20000/- or 50000/- as the case may be.

The basic thing which we have to see is the nature of the transaction and the definition of the word " Rent ".