194Q versus 206C(1H) of the Income Tax act, 1961
The Finance Bill, 2021 has introduced section 194Q - TDS on purchase of goods which is having resemblance to section 206C(1H)- TCS on Sale of Goods brought in by Finance Bill, 2020. There is ambiguity regarding their simultaneous applicability to businesses, which is explained as under:
![194Q Vs. 206C(1H) of the Income Tax act, 1961 194Q Vs. 206C(1H) of the Income Tax act, 1961](/img/preview/paidnfree/analysis.jpg)
194Q | 206C(1H) | |
Particulars | Remarks | |
Purpose |
|
|
Applicable to |
|
|
Counter party |
|
|
Triggering point |
|
|
W.e.f |
|
|
Timing |
|
|
Advances |
|
|
Rate of TDS/TCS |
|
|
PAN not available-Rate of TDS |
|
|
On which amount |
|
|
Not applicable to |
|
|
Exclusions |
|
If Buyer is-
|
TAN Requirement |
|
|
When to deposit/collect |
|
|
Quarterly statement to be filed |
|
|
Certificate to be issued to seller/buyer |
|
|
Example:
Sr No. | Buyers Turnover | Sellers Turnover | Transaction Value | Section Applicable |
1 | 5Cr | 11Cr | 55Lakhs | 206C(1H) |
2 | 15Cr | 7Cr | 58Lakhs | 194Q |
3 | 12Cr | 13Cr | 54Lakhs | 194Q |
4 | 7Cr | 5Cr | 58Lakhs | NA |
5 | 12Cr | 15Cr | 45Lakhs | NA |
The views expressed above are of the author and does not intent for any professional guidance.