TDS U/S 194 J

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M.Arshad (Querist)
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15 April 2008 Please let me know what will be effective TDS Rate for a firm of Advocates in respect of legal fees

XYZ & Associates
Advocates

Whether it will be trated as firm ??
plz let me knw TDS Rate,surcharge (if appl).

Sanjeev Kumar Sharma

Sanjeev Kumar Sharma (Expert)
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15 April 2008 yes, it will be treated as firm
and and fee received will be treated as professional fee and tds rate is 10.3%

M.Arshad

M.Arshad (Querist)
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15 April 2008 But dont u think if it is firm ,surcharge @10% will also be charged on 10% .

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R.V.RAO

R.V.RAO (Expert)
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15 April 2008 UNDER SEC 194J OF INCOME TAX ACT,TDS @10.3% WILL BE DEDUCTED ON THE ADVOCATES FEES PLUS SERVICE TAX @12.36% CHARGED BY THE ADVOCATES ON THE FEES.
R.V.RAO

R.V.RAO

R.V.RAO (Expert)
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15 April 2008 YES MR.ARSHAD,IF THE AGGREGATE OF PAYMENT SUBJECT TO TDS EXCEEDS RS. TEN LAKHS ,THEN SURCHARGE OF 10% ON TAX IS ATTRACTED.THANKS FOR POINTING OUT.
R.V.RAO

M.Arshad

M.Arshad (Querist)
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15 April 2008 I think there is some confusion,as per my knowledge ,in case of payment to a firm we need not to check 10 lakh limit .We will have 2 deduct TDS @ 10% plus surcharge 10% plus 3% edu cess ,total comes to 11.33 % ..

Subash Gaijes

Subash Gaijes (Expert)
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15 April 2008 No Mr. Arshad. In the case of making a professional payment, the applicable Basic TDS Rate is 10%. If the payments you are going to make exceeds Rs. 10 Lakhs in a year, then surcharge of 10% will be applicable. In both cases TDS of 3% will be applicable. So the Cumulative rate will be as follows;

1. Without Surcharge : 10.3%
(Applicable if the payments in a year to the firm does not exceeds 10 Lakh)
2. WITH SURCHARGE : 11.33%
(Applicable if the payments to a firm exceeds 10 Lakh)

For better clarifications you can refer to the Income Tax Act or Reckoner