Tds on contract

TDS / TCS 1354 views 5 replies

lakshmikant

student

44 Points Posted on 11 July 2012

If an individual who is liable to get his accounts audited under section 44AB pays money to a contractor for building own house which will be utilised for personal use, does that individual have to deduct tax at source under section 194C? As per my knowledge individual is not required to deduct tax at source as services of contractor are use for personal benefit. Want to know whether my view is correct or not. Please reply. Regards, Lakshmikant Hebare

Replies (5)

Parihar Gopal

Corporate Taxation

392 Points Posted on 11 July 2012

(U/S 194 C Subsection -4 -) No TDS is required to be made by an individual or a HUF where payment is required to be

made to the contractor for the work carried out for the personal purpose of such

individual/HUF

valji

Accounts manager-MBA

2150 Points Posted on 11 July 2012

agree with above

pravin

Audit

26 Points Posted on 11 July 2012

No TDS is required to be made by an individual or a HUF where payment is required to be

made to the contractor for the work carried out for the personal purpose of such

individual/HUF(sub section 4);

CA.Saibaburao Nanduri

Chartered Accountant

3847 Points Posted on 11 July 2012

Dear Mr. Lakshmikant !

Let us examine what the Section 194C (4) and (5) which are more relevant in this case.

The extract of the said Section is as follows:

194C (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.

194C(5) No deduction shall be made from the amount of any sum credited or paid or likely to be credited or paid to the account of, or to, the contractor, if such sum does not exceed [thirty] thousand rupees

Hope your doubt is cleared as per the Sections cited above.