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Section 194j of income tax

CA Vipul Jain (student) (50 Points)

06 March 2012

I a company pays 25,000.00 on one time and pays 15000.00 on second time than on what amount tds should be deducted? under section 194j wheather on 15,000.00 or 40,000.00

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7 Replies

valji (Accounts manager-MBA) (2150 Points)
Replied 06 March 2012

ON 40000

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valji (Accounts manager-MBA) (2150 Points)
Replied 06 March 2012

tds payment made ON PAYMENT ON CREDIT WHICHEVER IS EARLIER SO WHILE MALING PAYMENT OF RS 25000 YOU HABE TO DEDUCT TDS WHETHER BILL COME OR NOT

Sivaguru SM (Tax Consultant) (235 Points)
Replied 06 March 2012

If a payment made or deemed to be made above Rs.20000 to same Individual/ HUF/ BOI/ AOP in same year it should be taken cumulatively i.e, TDS should be deducted on Rs.40000.

Prateek Agarwal (Sr. Executive - Finance & Accounts) (1732 Points)
Replied 06 March 2012

Hi,

Professional Fees Limit is Rs. 30,000/- cumulative or single payment in a year. Since first bill is of Rs. 25,000/-, it may be deemed that there would be further payments during the year, hence, deduct tax on the first bill itself.

CA PRAVEEN SINGH (MANAGER ACCOUNTS) (2277 Points)
Replied 06 March 2012

BASIC PRINCIPLE FOR DEDUCTION TDS IS IF SINGLE BILL IS RS 30000 OR EXCEED..& YEARLY EXCEED RS 75000 IN A YEAR...

SO THAT IN ABOVE CASE SINGLE PAYMENT IS NOT Rs 30000 or ABOVE..BUT IF PRESUMED THAT IN YEAR LIMIT WILL CROSS. SO THAT TDS IS TO BE DEDUCTED OF BOTH BILL RESPECTIVELY...

RS 25000 AND RS 15000 TOTAL RS 40000.U/S 194J

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Vivek (CA FINAL) (75 Points)
Replied 06 March 2012

BASIC PRINCIPLE FOR DEDUCTION TDS IS IF SINGLE BILL IS RS 30000 OR EXCEED..& YEARLY EXCEED RS 75000 IN A YEAR...

SO THAT IN ABOVE CASE SINGLE PAYMENT IS NOT Rs 30000 or ABOVE..BUT IF PRESUMED THAT IN YEAR LIMIT WILL CROSS. SO THAT TDS IS TO BE DEDUCTED OF BOTH BILL RESPECTIVELY...

RS 25000 AND RS 15000 TOTAL RS 40000.U/S 194J

SIR HE ASK ABOUT 194J TDS ON PROFESSIONAL OR TECHNICAL SERVICE AND YOU GIVE SOLUTION AS PER 194C PAYMENT TO CONTRACTOR.........

As per 194J no tds shall be deducted if any fees paid for professional service during the F.Y. not exceed 30000.. so if 25000 and 15000 is paid to same person in a F.Y. then TDS should be duducted on full amount of 40000 rs.

Ritesh Jain (CA, CS in Job) (675 Points)
Replied 06 March 2012

where the amount of sum under 194J or, as the case may be, the aggregate of the amounts of sum under 194J credited or paid or likely to be credited or paid during the financial year by a person to the account of, or to, the payee, does not exceed Rs 30,000/- the ITDS liability does not arise..

There fore, If single payment exceeds Rs 30,000--- Yes TDS attracted

IF multiple payment , sum of all exceeds Rs 30,000---yes ITDS attracted..

Now question comes when to deduct if initial payment is below Rs 30,000/-..

if u can establish that further payments are to be made and total can exceed Rs 30,000---TDS from first payment.

If u cannot figure out wether any future opaymnet could arise or not then no need to do ITDS but when future payment arises then deduct ITDS on total sum i.e including previouys payment during that F.Y.

Rgds,

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