IN CASE THE COMPANY HAS DEDUCTED TDS RATE OF 2 % IN CASE OF SERVICE PROVIDER IN THE NATURE OF CONTRACT SERVICE BUT ACTUALLY CONTRACT AGREEMENT HAS NOT ENTERED. THEN WHAT SHOULD BE THE TDS RATE?
Member
(Management)
(325 Points)
Replied 18 July 2010
If the transaction is one of contract, then the rate is only 2%, irrespective of whether you have entered into the contract or not since you have already made the payment or credited the sum to the payee's account in your books. The rate will vary only when the contract is for rendering professional services or such other things for which different rates have been prescribed in the Income Tax Act.
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