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TDS ON GLOW SIGN BOARD

santhosh (CA) (636 Points)

15 September 2009

Hi all

Pls Clarify my Doubt on TDS Aspects in the Following case:

A company arranges an individual/Firm to prepare a Glow Sign Board for displaying its brand name on its retail outlets. Should TDS be deducted on Payments made such parties. I guess TDS is not applicable cos the nature of expense is similar to purchase of material. Pls Explain with reference to any case law/circular of any

Thanks

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8 Replies

sivaram (Asst Mgr-Taxation) (6918 Points)
Replied 15 September 2009

You have to deduct TDS under Contract if the payment exceeds Rs 20000/= but if the bill shows the material and labour portion seperately deduct TDS only on labour portion

santhosh (CA) (636 Points)
Replied 15 September 2009

But if NO separation is given in Invoice. Also VAT is Charged on a flat sum , Now whats you view?

sivaram (Asst Mgr-Taxation) (6918 Points)
Replied 15 September 2009

Deduct TDS on Contract under 194C

aurangzaib khan (financial consultant) (95 Points)
Replied 15 September 2009

your company engage a person to prepare a glow sign board. therefore i think your company made a work contract with that person to prepare a sign board. if these work is nature of work contract therefore TDS is applicable under 194C of labour charges other wise no tds will applicable.

CA.Parsun Garg (JOB) (1380 Points)
Replied 15 September 2009

Hi all,

TDS Rates from 01.04.2009 to 30.09.2009 under section 194C:

Payment under subcontracts/Advertising contracts value exceeding Rs 20,000 or Cumulative Payment exceeding Rs 50,000 for Individual/HUF & for Other than Individual / HUF Rate is @ 1%.

Payment under contracts value exceeding Rs 20,000 or Cumulative Payment exceeding Rs 50,000 for Individual/HUF & for Other than Individual / HUF Rate is @ 2%.

TDS Rates from 01.10.2009 under section 194C:

Payment under any contracts value exceeding Rs 20,000 or Cumulative Payment exceeding Rs 50,000 for Individual/HUF Rate is @ 1% & for Other than Individual / HUF Rate is @ 2%.

Conclusion:

Your company arranges an individual/Firm to prepare a Glow Sign Board for displaying its brand name on its retail outlets, company should deduct TDS on Payments made to such parties @ 1% & in case of company it will be @ 2%.

Cavin (Accountant) (21 Points)
Replied 10 October 2015

Hi All,

Please clarify my doubt on the following:

We have recieved a Invoice of LED sign board for our new outlet, where the details is as below:

LED Sign board - Rs.1,18,900

Vat/CST @ 12.5% -Rs.14,862.5

Total -Rs.1,33,762.5

Shipping,Packing & installation - Rs.31,000/-

Grand Total =Rs.1,64,763/-

* Whether TDS is to be deducted. If yes at what Rate & on which amount.

*Can we claim input VAT

JAGANATHAN R ACMA, SAP(Fi-Co) (Manager Accounts and Finance) (915 Points)
Replied 10 October 2015

the sign board related to admin expenses and not related to mfg.,

if you have breakup separtely shipping, packing, installation., the packing and insatllation are applicable for TDS , and shipping is not applicable. otherwise you can consider all exp. shipping, packing, installation are TDS Transaction. and deduct the tds