TDS Return and Bill booking queries

Hello Knowledge community
Today I am stuck in one of the most typical question. Suppose I am a work contractor I want to hire some machinery from other suppliars for execute my work.

How much TDS I need to deduct under which section?
Can I book bill on quaterly basis to deposit the TDS after a quater and file the same?

If I book my bills monthly but I deposit Tax after Quater?
If I deduct TDS but not deposit the same after the Financial Year?
kindly share your valuable knowledge
Thank You
Replies (5)
Quick Summary
This discussion clarifies TDS (Tax Deducted at Source) obligations for contractors hiring machinery. TDS is generally deductible under Section 194I at 2% if annual hire charges exceed £2.4 Lakhs. Bills can be booked quarterly, with TDS deposited by the 7th of the following month. If bills are booked monthly but TDS is deposited quarterly, a 1.5% monthly interest penalty applies. Failure to deposit deducted TDS can lead to a 30% disallowance of expenditure during Income Tax Return filing.

Tds on property
1.You have to deduct tds under section 194i(a) @ 2% if the hire charges per year is more than 2.4lakh.
2.The mechanism over here is when ever you book the bill by next month 7th you have to deposit or pay through chalan to government, you can book the bills on quarterly basis also.
3.If the tds deducted is not deposited within 7the of next month then interest will be leived at 1.5% per month on tds amount including the month of default till the month of payment.
4.There may be a dispute with the person from whom you have deducted tds and late fee will be applicable for missed out tds filing.
Work contractors registration is required.

1. TDS to be deducted u/s 194I @ 2% if the annual hiring charges exceeds Rs. 2.4 Lakhs. 

2. If the bills are raised on a quarterly basis and payment is also made after receiving the bill then TDS can be deducted quarterly. 

3. If bills are being booked monthly and you make TDS payments quarterly then late payment interest has to be paid @ 1.5% per month. 

4. If you deduct and do not deposit the TDS then 30% of the expenditure will be disallowed at the time of filing of Income Tax Return. 

Thank You for valuable comments

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