TDS on retainership fees paid to advertising agency

This discussion explores the correct TDS rate for retainership fees paid to advertising agencies. The core question is whether to apply the 1% rate under Section 194C or the 10% rate under Section 194J. While retainership fees for professional services typically fall under 194J at 10%, the nature of advertising agency retainership, often seen as a service rather than a professional engagement, leads to debate. Some have historically applied 194C at 1% without issue.