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tds on transport

Ajay Kumar (Account Supervisor) (129 Points)

28 October 2017

if we pay freight to driver then whom TDS to be deducted driver or gta who just raised the bilty for commission

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Abhishek Kanth (career) (117 Points)
Replied 28 October 2017

Yes, You can release the payment via cheque in the name of Truck driver provided the TDS has been made u/s 194C in the name of the party who has issued the invoice.

TDS is to be made on the Freight Invoice-issuing party and not on the payee. It can be rightly said that the Payee has no role to play in the deductibility of Tax at source. Only the Identity of Invoice raising party is relevant.

Hence, the issue may be summarised as follows:

If Invoice issued by Transporter -> TDS to be made on Transporter (Payee can be anyone since the amount released to truck driver is ultimately going to reach the transporter)

If Invoice issued by Truck driver -> TDS to be made on Truck driver itself.

Hope this clarifies the issue.