Sub contractor

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 May 2012 Dear expert,
One of my client is a contractor and for FY 2012-13, his gross receipts would be around 55 lacs. Like previous years, he will opt sec. 44AD for AY 2013-14.
In FY 2012-13, he is employing one person as sub contractor and payment to that sub contractor would be around 14 lacs during the year.
Now my query is that whether my client has to obtain TAN and to deduct 1% on the payment of that sub contractor?
or
he will be immune from obtaining TAN, as he will opt Section 44AD.
Please advise me.

Amol Gopal Kabra (CA,CS,DISA)

Amol Gopal Kabra (CA,CS,DISA) (Expert)
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01 May 2012 In case the client is opting for Section 44AD, then there will be no audit for the financial year 2011-2012. So accordingly, there will be no need to deduct TDS as TDS is applicable only in case of Audit (For individual and HUF)

Querist : Anonymous

Querist : Anonymous (Querist)

01 May 2012 if it is the partnership firm, then ?

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Amol Gopal Kabra (CA,CS,DISA)

Amol Gopal Kabra (CA,CS,DISA) (Expert)
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01 May 2012 If it is a partnership firm and opts for section 44AD, then no TDS as all expenditure is assumed to be considered so no question of disallowance.