Lower deduction certificate

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

24 August 2011 Dear Sir,

I have received a lower deduction certificate from my vender to deduct TDS @2% instead of 10%.

The amount limit mentioned in certificate is of Rs. 10,00,000 ( ten lakhs only).

What shall be situation if during the year the transaction with that vendor reaches to 11 lakhs.

Can I deduct lower TDS above Rs. 10 lakhs or will I have to deduct normal TDS on the amount above 10 lakhs.

Please suggest

Thanks in advance

CA Amit Joshi

CA Amit Joshi (Expert)
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24 August 2011 Dear author,
As per my knowledge you have to deduct TDS @ 2% up-to 10lacks and 10% over and above 10 lacks.
Opinion of other experts are also invited.

Message likes : 1 times

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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24 August 2011 yes. lower deduction certificate apply only Rs.10 lakhs,in case cross Rs.10 Lakh then normal TDS rate

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Querist : Anonymous

Querist : Anonymous (Querist)

29 August 2011 I came to know from some one that the amount mentioned in lower deduction certificate is just a tentative amount, and if the transactions increase that limit, still we have to deduct lower TDS as per certificate