Clarification on TDS to be Deducted

TDS 1347 views 6 replies

R. Narasimhan

Oracle Financial Functional Consultant

39 Points Joined August 2009

Dear All

One of the company has multiple offices and has seperate TAN Number for each office. The company has suppliers rendering services to each office seperately. Each office of the company considers the supplier differently and deduct TDS on Invoices accordingly. As a result, if the supplier renders service for four offices for Rs. 15K each none of the offices deduct TDS as it is not crossed single invoice limit of Rs. 20K and does not consider the cumulative total amount. Is it acceptable practice as per the Income Tax Act Provisions relating Tax Deduction at Source? Kindly let me have your reply / Advice.

Replies (6)

suneet

CA FINAL

421 Points Joined June 2008

it does not matter about the offices of company.company is a "assessee" under income tax act .

The threshhold limit applies to whole of the company not to individual offices

JINESH SHAH

PRACTICING CA

151 Points Joined August 2010

TDS SHOULD BE DEDUCTED ON TOTAL AMOUNT IRRESPECTIVE OF BRANCHES

mallela.ravikiran

learner

136 Points Joined October 2008

Dear Narsimhan,

we have to verify bill wise as well as accumilated payment also as per income tax act.

e.g: ( 194C) bill amount less than Rs. 20,000/- but payment made per annum Rs. 75,000/- or more we need to deduct TDS.

if payment made less than Rs.75K per annum & invoice less than Rs. 20K no need to deduct TDS.

Regards,

* Krishna *

CA Student

6149 Points Joined March 2009

I think the annual threshold limit for payments made is Rs 50,000, not Rs 75,000. Kindly anyone clarify.

Mitali Agarwal

Company Secretary

638 Points Joined January 2009

Originally posted by : Krishna
	I think the annual threshold limit for payments made is Rs 50,000, not Rs 75,000. Kindly anyone clarify.

Under Section 194C, the threshold limit per contract is Rs. 30000 (w.e.f. 01.07.2010 earlier 20,000) and Rs. 75,000 (w.e.f 01.07.2010 earlier 50,000) for annual payment.