Whether to deduct tds or not

You have to deduct TDS As per Income tax act

Firms have to deduct TDS irrespective of Turnover. Only Individuals and HUF not subbject to 44AB audit do not have to deduct TDS except for following cases where they too must deduct:-

Salaries

Individual / HUF Contractors paying / crediting to a sub contractor.

Following persons are liable to deduct the tax at source:-

A) All Individuals (Including sole-proprietorship concerns) and HUF, who are not covered under tax audit, shall deduct TDS against all the specified payments except:-

• Interest paid
• Payment to contractor and sub-contractors.
• Commission Paid
• Rent Paid
• Professional fees and technical fees paid.

B) Individual/HUF who are covered under tax audit, will deduct tax at source on all specified payments.

C) Partnership firms and Companies and persons other than individuals and HUF, will deduct tax at source on all specified payments.

Tax audit: A person is liable to get its account audited u/s 44AB of Indian Income Tax Act, if the gross receipts or gross turnover exceeds Rs.60 lacs during financial year and Rs. one crore during financial year 2012-13 in case of a business and in case of profession the gross receipts exceeding Rs.15 lacs in financial year 2011-12 and Rs.25 lacs in financial year 2012-13.

Note: Payments made by individual/HUF against specified payments, shall not be liable for deduction at source for following purposes:-

1. Payment to contractor or sub-contractor, exclusively for personal purpose.
2. Payment of professional fees and technical fees exclusively for personal purposes.
3. Rent for personal purposes.

If the bill raised by the contractor is of a Partnership Firm, then whoes PAN is required individual or firm

 

If the bill raised by the contractor is of a Partnership Firm, then  whoes PAN is required Individual or Firm