Tax (tds) on service

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pankaj birdi

Others

34 Points Posted on 26 May 2014

An Indian Company exports the machines to some overseas company through agent.

The agent takes care of installation of the machines there at buyer's company. The agent charges some amount from Indian Company as installation charges.

Now, when paying the installation charges to this agent, do Indian Company need to deduct the tax (TDS) on the installation/ service charges. If so, how much % of TDS will be dedcuted?

Replies (7)

praveen

Chartered Accountant

5709 Points Posted on 26 May 2014

I think you may have to deduct tax at 10% under technical services - 194J

capraveenmr.wordpress.com

praveen

Chartered Accountant

5709 Points Posted on 26 May 2014

I think you may have to deduct tax at 10% under technical services - 194J

capraveenmr.wordpress.com

Tribhuvan Aditya Singh

Student as well as Self-employed

3853 Points Posted on 26 May 2014

94C or 94J both can be applicabke in this case, but since installation requires technical skills therefore deduction u/s 94J @ 10% will be more appropriate.

pankaj birdi

Others

34 Points Posted on 27 May 2014

What if we show that this amount is being paid as commission, not installation charges, then do we need to dedcut the tax/tds or not?

Tribhuvan Aditya Singh

Student as well as Self-employed

3853 Points Posted on 27 May 2014

you still need to deduct tds u/s 94H of the amt. is more than 5000.

I think TDS u/s 194H might be applicable only on the part of amount paid as commission to the agent , and no TDS on technical services will be deducted as services are provided to the overseas company buying the machine and not to the company exporting , the agent is merely recovering the amount spend upon installation.

Ihor Ischuk

32 Points Posted on 22 May 2026

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