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TDS u/a 194Q

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AUDIT MANAGER
109 Points Posted on 31 July 2021
A Machine having worth Rs. 5,05,000,00/- to be purchased from Seller A. Advance Payment details are as below –

Rs. 1,02,000,00/- have been paid before 31.03.2021.

Rs. 1,00,000,00/- to be paid in Aug. 2021.

Rs. 3,03,000,00/- to be paid in Sept. 2021 after delivery of Machine & Invoicing.

Please suggest amount of TDS to be deducted u/s 194Q ?
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On 31 July 2021 at 11:09 Report
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Chartered Accountant
24588 Points Posted on 31 July 2021
Yes TDS under section 194Q is applicable as purchase value exceeds 50 lakhs rupees
129 Reply
On 31 July 2021 at 11:54
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AUDIT MANAGER
109 Points Posted on 31 July 2021
0.1% of which value ?

When TDS to be deducted i.e at the time of advance payment or at the time of Booking of Invoice ?
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On 31 July 2021 at 12:51
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Chartered Accountant
24588 Points Posted on 31 July 2021
At the time of payment to supplier or at the time of credit to his account whichever is earlier.

0.1% of purchase value
129 Reply
On 31 July 2021 at 12:52
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CMA
13117 Points Posted on 31 July 2021

Tax u/s 194q to be deducted at source at the time of payment or credit whichever is earlier. Further, CBDT vide it's circular has clarified that if payment has been made prior to 1st July 2021, no TDS in respect of the same.

Hence, you are required to deduct tax at source on the balance payments that you intend to make in aug and sep.

92 Reply
On 31 July 2021 at 13:07
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Chief Accountant
3150 Points Posted on 31 July 2021
At the time of payment or credit whichever is earlier
9 Reply
On 31 July 2021 at 17:37


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