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TDS on labour supply

chamarthi venkatesh (Student CA Articleship) (848 Points)

10 November 2017

if a manufacturing company appoints labours provided by a contractor for its manufacturing and pays monthly salary to the labours, then how TDS is to be deducted ?
i.e., whether from the salary, or from the amount company is paying to the contractor.

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6 Replies

CA Abhishek Goyal (Chartered Accountant) (516 Points)
Replied 10 November 2017

If contractor is issuing bill to company then TDS needs to be deducted accordingly u/s 194C. If company is paying salary then you have to see the limits of each labourer wise.

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Shivanand Achari (Student) (28 Points)
Replied 11 November 2017

How much labour wise limits?

CA Abhishek Goyal (Chartered Accountant) (516 Points)
Replied 11 November 2017

If you are paying salary then accordingly 192B has to see. And if you r making payment to contractor only then only 194C will come into picture.

chamarthi venkatesh (Student CA Articleship) (848 Points)
Replied 11 November 2017

salary is around 20,000 per month for each labourer

CA Abhishek Goyal (Chartered Accountant) (516 Points)
Replied 11 November 2017

then no need to deduct. as it is less than basic exemption limit. bt in case of contractor you have to see the limit accodingly.

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Umesh V Naig (Statutory Analyst) (452 Points)
Replied 11 November 2017

providing labour means , sub contracting raising services invoice on you then 194c appliesif company pays directly to the individual labour if exceeds salary income limits then 192 B applies but the contractor supplies labour amounting to management recruitment services it amounts to professional services then 194J professional applicable ofcourse GST added