TDS for Payment to Contractors in house construction

TDS 4496 views 6 replies

Sreejesh V K

ICMA Final Student

147 Points Joined February 2010

Hi All,

I m going to construct a new house for self use. During construction if I pay more than 50,000 to my contractor, is this liable for TDS??

Replies (6)

Max Payne

employed

2574 Points Joined May 2008

No need Sreejesh.

Tax Deduction is not required if the payments are for personal purpose by individual and HUF....

You can see the provision in section 194C.

saranraj

CA FINAL

419 Points Joined November 2008

INDIVIDUAL OR HUF HAVE TO DEDUCT TDS IF HE/SHE IS SUBJECT TO TAX AUDIT DURING FINANCIAL YEAR IMMEDIATELY PRECEDING THE PREVIOUS YEAR.

FOR EG.

FINANCIAL YEAR 2009-10

ASSESSMENT YEAR 2010-11

IF YOU ARE PAYING AMOUNT DURING 2010-11, YOU MUST DEDUCT TDS ONLY IF YOU WERE SUBJECT TO TAX AUDIT DURING 2008-09.

SRINIVAS SRIRAJ

Chartered Accountant

130 Points Joined September 2009

"[Payments to contractors.

⁷¹194C. (4) No individual or Hindu undivided family shall be liable to deduct income-tax on the sum credited or paid to the account of the contractor where such sum is credited or paid exclusively for personal purposes of such individual or any member of Hindu undivided family."

In the light of the above extract from the Income Tax Act, 1961, Tax need not be deducted at source from Contract (Personal) payments made by an Individual or HUF