TDS rate 2 % or 10%

99313 views 15 replies
we have taken managed network services
sac code is 998316 & 998414

we deduct TDS on 10%

its correct or not.
Replies (15)
Quick Summary
TDS on managed network/IT services generally falls under Section 194J. Rate is 2% for technical services and 10% for professional services. Correct classification is key; PAN non-availability may attract 20% TDS.

It's a technical service so that 2% TDS should be deducted.

Yes, the service will be categorised as technical services.

Form 01.04.2020, TDS @ 2% to be deducted on technical services and @ 10% on professional services. 

TDS @ 2% will be applicable for Technical Services
This question is related to income tax ?
because there is no tax rate of 10% in gst tds

For Facebook  India & Zoom India (ZVC India Pvt. Ltd.) also 2% TDS will be deducted?, but in case they are deducting directly from Credit Card of a Company, then how TDS will be deducted? because there is no scope of deduction of TDS at the time of payment through a Credit Card.

Please help...

Dear Ujjal,

you have to deposit the TDS on behalf of Facebook & zoom India after that please claim that TDS Reimbursement from Facebook & zoom India via submitting the form 16 to them

Call me if you required further assistance

 

Regards

Sumit Jain

Sir , here we are discussing about TDS not GST

 

TDS rates applicable under Section 194J is as follows:

  • 10% on such income.
  • 2% if the payee is only engaged in the business of operation of a call centre.

No surcharge, education cess or SHEC shall be added to the above rates. Hence, tax will be deducted at source at the basic rates. Moreover, the rate of TDS will be 20% if PAN is failed to be quoted.

 

2% TDS will be applicable if it's a technical service

what will be the TDS rate on HSN 8708?

 

Now, threshhold limit is Rs. 50,000 

  • 194J -  Fees For Technical Services, Call Centre, Royalty, Distribution / Exhibition of Cinematography Films, etc. - 2%
  • 194J - Fees For All other Professional Services - 10%

RECENTLY WE HAVE TAKEN PANEL AND BROUCHER  DESIGNING WORK .

IN WHICH SEC. TDS DEDUCTED , & WHAT RATE.

 

PLEASE GUIDE WITH REFERENCE


These are treated as professional fees.

Rate is 10% for professional services.

There are two possible things you might be thinking of:

A. TDS on Income Tax (under the Income Tax Act, 1961)

If your payer is deducting TDS while making payment to your vendor for managed network services, then:

Applicable Section:
For IT/technical services → Section 194J of Income Tax Act

Applicable TDS Rate:

  • 10% (if PAN of payee is furnished)

  • 20% (if PAN is not furnished)

There is no link to SAC codes here.

So if it is IT/Technical/Professional service, 10% TDS under 194J is correct.

Exception: If it is purely business support services with no technical element, some people incorrectly apply 2% under 194C, but the correct is 194J for IT/related services.

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