Tds on recruitment charges

Page no : 2

Siliguri Security Services (6 Points)
Replied 15 March 2017

Dear Sir,

We are having a Security Service Provider Company & supply Security manpowers to the various clients.

One of our XYZ client deduct TDS from Total Manpower + S Tax Billing. i.e. if, suppose contract Amount is Rs.5000/- and Service Tax is 15%. The Total Bill amount is Rs.5750.00/-.

Client deduct upon TDS @ 2% on total BIll (Rs.5750.00/- X 2%) =Rs.115/-.

But, our local CA said that. the TDS deduction rule is to Rs.5000/- x @ 2% = 100/- is TDS Amount

Please help me out to short out the problems.

Warm Regards

Narayan Biswas

9233444407

Babita (Asst. Manager) (27 Points)
Replied 04 June 2021

Sir, TDS will apply on taxable value, And for safer side always it is good practice to deduct TDS on taxable value means they can deduct on -Rs- 5750/-

Rajasekhar Palagati (2 Points)
Replied 06 January 2022

Provisions of section 194C apply to a contract for carrying out any work including supply of labour for carrying out any work. Payments to recruitment agencies are in the nature of payments for services rendered. Accordingly, provisions of section 194C shall not apply. The payment will, however, be subject to TDS under section 194J of the Act.

Hence its 194J

KG Accounts (2 Points)
Replied 06 February 2023

Hi, TDS will be deducted on the base value not the invoice value, when the service provider given an invoice with the break-up, accordingly you have to deduct for Rs.5000.00 only not the invoice value.