Applicability of TDS

This query is : Resolved

TH (Querist)
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12 March 2009 Dear Sir,

Is a TDS tax payment for the account of a vendor be a benefit to the vendor or would it be simply an advance tax the vendor has to pay? Also, is there any other benefits to the vendor when a TDS tax payment is made for the vendor's account?

Sukanta Mandal

Sukanta Mandal (Querist)
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12 March 2009 Ours is small IT compant which is registered under STPI. We may fear that next year our export revenue will fall below 50% of total revenue. What would be the consequence for this. Secondly what kind of measures we can take like incorporating a separate co or creating another unit to get the STPI benefits even though as a whols co, export falls below 50%.

Regards
Sukanta

CA Tilak Raj Sharma

CA Tilak Raj Sharma (Expert)
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12 March 2009 TDS - TDS is treated in the same way as advance tax at the computation of final tax liability. It is deducted from the final tax liability and you have to pay balance tax if any or you will get refund if the TDS is higher than the final tax liability.

It is current assets in the hands of vendor/deductee.

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CA Tilak Raj Sharma

CA Tilak Raj Sharma (Expert)
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12 March 2009 STPI - I don't understand what do want to ask above.

If the export turnover is going to fall, then why do you need a separate unit. you will get the STPI benefits in the same way whether your turnover increases or decreases.