TDS on car hire charges

194C is correct for CAB Payments

dont go by just section if car is provided with driver it will in nature of 194 c as same is in nature of payment to contractor. how ever car is taken as such and driver is appointed by Ur comapny TDS on rent(194 I) will be deducted.

Earlier TDS may either be deducted under section194C or 194I on vehicle hire charges. But there has been an amendment made by Finance Act recently which results in deducting the TDS On above Exp under Section194I. Hence your auditor is correct.

Dear Friend It is depend on agreement made between company & car owners.If company paid regularly & charge basis is not a passenger basis but it is a day or hour basis irrespective of nos. of passenger would take journey on behalf of company then it should attract TDS under Section 194 I other wise on passenger basis it is a contract on per passenger basis & it would attrcat TDS u/s 194C

can i know % of TDS tobe deducted on car hire charges

What is exact rate For deducting TDS on rent a cab service ?

we are having Hired Sumo for Pickup and Drop of Staff Member How much TDS Should Apply on the services

If a car is leased for, say, a year and is under the control of the company and it is the company’s responsibility to run and maintain it, the payment would be in the nature of rent and Section 194-I would be applicable otherwise it comes u/s 194-C.

In your case, I think, the auditor is wrong because in your case car is hired for specific purpose and there is tds applicable u/s 194-C.

I think Sunil sir is Absolutely correct on his view.

1. 194 C
2. 194 I

• Taxi on specific job:when ever taxi or any other vehicle booked for a specific Job like giving a contract to take employees from home to office and office to home .In these type of work a specific job has been assigned to vehicle and vehicle has not been hired as such so it should be covered u/s 194C and not under section 194I
• Control of owner of vehicle:In most of the time vehicles are hired with driver and control of the vehicle remain with the owner of the vehicle through driver,but this is not the deciding factor at all though its a point to be considered,whenever the control of vehicle remains with the the owner of the vehicle then it generally means that vehicle is specific job and not hired as such ,so deduction should be under 194C .but some times vehicle with drivers are also hired without specific jobs in that case person who has hired the vehicle can travel on it any where thought there may be some restriction but point is that no specific job has been assigned ,so in this case it will be covered under section 194-I. Same has been held by  Chattisgarh State Electricity Board vs. ITO (ITAT Mumbai) Read more: https://www.simpletaxindia.net/search/label/SEC%20194%20I#ixzz1x4FT2b4U
• Contract agreement:The main paper which will decide the issue is contract agreement and issue will be decided mainly on the basis of the term of agreements and if there are slight differences from contract that can be ignored.TDS on hired vehicle for fixed amount is covered under section 194C and not section 194I.(read case law here)
• Running & maintenance :If running & maintenance expenses like petrol,repair etc has been incurred by the person who has hired the vehicle then we can say that it should be covered under section 194-I