11 October 2011
Sir, our project contractor which is a pvt. co. has got contract for supply ,errection & commissioning of site fabricated tank. Work order value around 58 lakh.
Suggest me for tds for making payment against 1st ra bill for rs.20 lakhs.
11 October 2011
Your case is covered by section 194c of Income tAx Act. Deduct TDS @ 2%.
Issues:
1] If project contract cost is Rs 58 lacs and project is tobe completed within this year and contractor has issued bill of Rs 58 lacs then deduct 2% tds on 58 lacs irrespective of payment u have made.
2] If contractor has issued R.A bill of Rs 20 lacs then deduct TDS 2% on 20 lacs. Record the bill of Rs 20 lacs as R.A. Bill is valid.
3] 194c says deduct the TDS on payment or credit whichever is earlier.
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