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Tds on electricity material supplier invoice

5381 views 1 replies

ATANU BANERJEE

Accounts Executive

75 Points Joined June 2013

Sir,

Can I deduct TDS when making a payment to contractor for supplying of Electrical Materials , Testing & Repairing of above Materials. They have provided us an Tax invoice on 10.10.2015 , but we have received the invoice on 16.02.16, including VAT @ 5%.We have already paid Rs.20000.00 on 22.09.15 as advance.Now we are going to pay the final amount.So what is the TDS % if applicable and from which date.

Replies (1)

CMA Poornima Madhava

CMA

13117 Points Joined May 2009

If it is just supply of material, then no need to deduct tax at source. But in addition to supply, if labour is also involved, then tax to be deducted at source u/s 194C on labour portion provided material and labour is shown separately. If not shown separately, then tax to be deducted u/s 194C on full invoice value.
If the contractor is individual (TDS @ 1%) and for others (TDS @ 2%) on the total value (if aggregate value exceeds Rs.75000 in a year or a single bill value exceeds Rs.30000)
PAN of the contractor is necessary
Assuming that labour is also involved, TDS is applicable even on advance payment (on exceeding the limit), However, in this case advance of Rs.20000 paid does not exceed threshold and hence no TDS applicable at the time of payment of advance
Though the invoice is dated earlier, it has been received by you now and hence account it in this month and pay TDS (if amount exceeds the limit) within due date by next month.