Tds to subcontractors

From my company we are making payment to a party who inturns making payment to another party who is exempted from tax (ie.government institution).

In brief:

Our company and another company sharing expense of a government institution, we are making payment to another company and he inturns makes payment to the government institution in full without deducting TDS!!.

Now tell me whether we have to deduct TDS on the another party for this transaction??

 

Replies (5)

Mr.Meyyappan

Please frame your question precisely again.

Best Wishes

Sathikonda

Dear Sathikonda,

We are making payment to anna university (who is exempted from TDS) thru another vendor [as we both share the exp] and he inturns makes the payment to anna univ without deducting TDS.

Now tell me whether we have to deduct TDS for this another vendor or not??

Hope this is clear!!

It is not about who is making payment to whom. First, have to look whether your company is directly rendering any service to that Govt Institution or not?

Dear Sonam Bidasaria,

Actually there is an agreement between both of the parties in sharing the expenses but in relating to the government institution we are not dealing directly!!

then you have to make deduction of tax against payment made to subcontractor.

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