we (Pvt. ltd company) are hiring a jeep on a monthly rent Rs.8500/- . we are not deducted the tds yet. please advice me the tds rates to be deducted and celing limit also.
thank you
Abhilash N K (Accounts officer) (24 Points)
08 October 2008we (Pvt. ltd company) are hiring a jeep on a monthly rent Rs.8500/- . we are not deducted the tds yet. please advice me the tds rates to be deducted and celing limit also.
thank you
Rabnoor Singh Khanna
(Accountant)
(77 Points)
Replied 08 October 2008
The ceiling limit is Rs. 120000/- annual. If total rent in a year is excess of this amount then tds on rent is applicable. The Rates in case of machinery, plant or equipment is 10 % plus surcharge & cess.
CA RAMESH KUMAR AHUJA
(CA, DISA, LLB)
(5452 Points)
Replied 08 October 2008
In case the control on vehicle(Jeep) is with the owner and he is engaged for the carriage of goods and passengers and all running cost is met by the owner then Tax is to be deducted u/s 194C. However, if the control is with the contractee then the tax is deductible u/s 194I.
subhash chauhan
(student)
(33 Points)
Replied 08 October 2008
ya i am satisfied with what rabnoor said.
Jitender
(Chartered Accountant)
(8724 Points)
Replied 08 October 2008
tds u/s 194C is applicable & not 194I.
NIKUNJ RATHI
(C.A)
(56 Points)
Replied 08 October 2008
You need not deduct tax at source in this case since it comes within the ceiling of Rs. 1.20 Lacs per annum.
Still if the payment appears to cross that limit , TDS U/s 194 I @ 10 % + surcharge and cess is applicable if you are paying the party monthly / weekly / daily fixed amount.
Since you have said that you are paying Rs. 8500/- per month , Section 194 I is applicable.
Whereas if you are paying the party on the basis of distance covered by the vehicle, then TDS U/s 194 C is applicable and the ceiling limit for that case is either 20000/- or 50000/- as the case may be.
The basic thing which we have to see is the nature of the transaction and the definition of the word " Rent ".
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