tds

This query is : Resolved

abhay srivastava (Querist)
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07 October 2009 If I have to pay a sum of Rupees to our contractor who have appointed the security guard in my college. I have to make a payment of Rupees 260000, Please suggest how much tds and at whar rate should I duduct while making such payment on 15-10-2009.

Shyam Lal Naik

Shyam Lal Naik (Expert)
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07 October 2009 It is assumed that you are following cash system of accounts.

The deduction will be under section 194C(ie. payment to Contractors). There are two rates at present. 1% or 2%.

If the deductee is an indivisual or huf, the rate is 1%, else 2%.

abhay srivastava

abhay srivastava (Querist)
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07 October 2009 Please correct me if I am wrong.

TDS amount- 260000x1%

ie-2600

Please suggest do we need to add education cess and higher education cess or only 1% ie 2600

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Shyam Lal Naik

Shyam Lal Naik (Expert)
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07 October 2009 I think, the calculation is correct.

No need to deduct any cess.