Tds for purchase
SDR ASSOCIATES (380 Points)
06 August 2021
tds .10% for above 50 Lacs purchases should deduct for taxable value or invoice value?
11 Replies
CA. Sourav Sarkar
(Chartered Accountant )
(24583 Points)
Replied 06 August 2021
On gross invoice value
CMA Poornima Madhava
(CMA)
(13112 Points)
Replied 06 August 2021
Tax to be deducted at source on the basic value (excluding gst).
CA Puja Sharma
(Chartered Accountant)
(4999 Points)
Replied 06 August 2021
TDS to be deducted on Invoice Value.
CA Salman Ansari
(Salman Ansari & Assoc.)
(247 Points)
Replied 06 August 2021
CBDT FAQ on section 194Q states:
"it is clarified that when tax is deducted at the time of credit of amount in the account of seller and in terms of the agreement or contract between the buyer and the seller, the component of GST comprised in the amount payable to the seller is indicated separately, tax shall be deducted under section 194Q of the Act on the amount credited without including such GST.
However, if the tax is deducted on payment basis because the payment is earlier than the credit, the tax would be deducted on the whole amount as it is not possible to identity that payment with GST component of the amount to be invoiced in future."
So if GST is separately mentioned, then no TDS on the GST component. Calculate TDS only on Basic Value i.e. Taxable Value.
But when GST not separately mentioned or when payment is made before invoice, then since GST is not determinable, then TDS has to be deducted on the entire invoice value.
adi true
(9 Points)
Replied 06 January 2022
| Originally posted by : Ansari Salman | ||
 |
CBDT FAQ on section 194Q states: "it is clarified that when tax is deducted at the time of credit of amount in the account of seller and in terms of the agreement or contract between the buyer and the seller, the component of GST comprised in the amount payable to the seller is indicated separately, tax shall be deducted under section 194Q of the Act on the amount credited without including such GST. However, if the tax is deducted on payment basis because the payment is earlier than the credit, the tax would be deducted on the whole amount as it is not possible to identity that payment with GST component of the amount to be invoiced in future." So if GST is separately mentioned, then no TDS on the GST component. Calculate TDS only on Basic Value i.e. Taxable Value. But when GST not separately mentioned or when payment is made before invoice, then since GST is not determinable, then TDS has to be deducted on the entire invoice value. |
 |
adi true
(9 Points)
Replied 06 January 2022
Mr. Ansari has very clearly explained the whole issue. Crystal clear explanation.
debora M
(BUSINESS DEVELOPMENT MANAGER)
(1697 Points)
Replied 06 January 2022
TDS is levied at a rate of 0.1 per cent of the transaction value of items purchased in excess of Rs. 50 lakhs. If the deductee fails to provide his or her PAN to the deductor, this rate may be as high as 5%. TDS should be deducted when the purchases are credited to the seller's account in the seller's books of account.
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