Sanjay Agarwal (MANAGER) (165 Points)
05 April 2010Our newly formed Pvt Ltd Co has taken an office from 1st April 2010 on Rent =Rs.35,000 pm.
Whether we have to deduct TDS on payment from 1st month itself.
If yes, at what rate and when it is deposited to be in Bank.
If No, from when or after what limit, liablity of TDS begins?
What is the minimum requirement for taking TAN for a newly Pvt Ltd Co.
Nicky
(Chartered Accountant)
(245 Points)
Replied 05 April 2010
a) TAN should be availed within one month of the formation of the compant.
b) The Threshold limit for deduction of TDS on Rent at present is Rs. 1,20,000/- but the Finance Act, 2010 has proposed an amendement of Rs. 1,80,000/- , which would be applicable from 01/06/10.
c) so you should not deduct TDS unless you cross 1,80,000/- in the given year i.e. for first 5 months post that you need to deduct TDS at 10% of the rent amount if the payee is a resident
d) You need to deposit the tax in follwoing month before 7th of the month...
Sunil Liladhar Kotak
(Manager (F & A))
(2025 Points)
Replied 05 April 2010
Dear Sanjay,
Pls go to the Following link for the relevat details
further as it is company the TDS clause will be applicable from the date of credit or Payment whichever is earlier.
need to apply for the TAN also in advance when u know that there will be TDS Liability
Sanjay Agarwal
(MANAGER)
(165 Points)
Replied 05 April 2010
Dear Friends,
If TDS on rent has to deducted after crossing of threshold limit of 1,80,000/- i.e. in our case after 5 months,
then, after 5 months, the TDS has to be deducted on the initial 5 months rent=1,75,000/- also, or the TDS deduction is on the amount exceeding 1,80,000/-
SUNIL GARG
(CHARTERED ACCOUNTANT)
(175 Points)
Replied 05 April 2010
Hello Mr Aggarwal,
TDS is to be deducted from the very first month of April because you know that your company will cross the maximum limit of Rs. 1.20 Lacs or 1.80 Lacs whatever the case may be.
Secondly, the TDS rate is 10% and you have to deposit it within 7 days from the end of the month in which the TDS is deducted.
Thirdly, you have to apply for TAN within a month from the date you are liable to deduct TDS. There is no minimum requirement from Co. to apply for TAN. You just have to submit the certificate of incorporation with Form 49B.
UDAY
(ACCOUNTS PROFESSIONAL)
(183 Points)
Replied 05 April 2010
Finance act 2010 applicable from 01.07.10 not from 01/06/10 as mentioned by Mr. Nicky. I do agree with Mr. Garg that TDS to be deducted from first month itself as the rules says Crossed or expected to Cross during the financial year.
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