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Tds Rate for Payroll processing charges

10 May 2007

Hi,

What would be the rate of deduction of TDS for payroll processing charges to be paid to an outsourced consultancy firm. Would deduction be under Sec 194C or 194J??.
Pls suggest.

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8 Replies

Popat Viral (25 Points)
Replied 10 May 2007

I think it should be under 194C ie. @ 2.244% or 2.04% whichever the case may be.

Regards

Viral Popat

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Mannoj Sharma (27 Points)
Replied 10 May 2007

TDS u/s 194C as it is contract for work . Not u/s 194I as this section do not cover work but only consultancy.

puran (Finance Officer) (48 Points)
Replied 22 October 2007

Hi It must be @ 10 % plus SC plus Ec as the rate applied u/s 194 j for a consultancy firm. regards Puran

Rachana Gadage (Account Executive) (136 Points)
Replied 24 October 2007

Hi, It is depend upon your contrct if u r mentioned that u hired them as a consultant then rate will be 11.33% otherwise 2.27% Regards Rachana

Vijay K. Agrawal (Service) (608 Points)
Replied 26 October 2007

10 % surcharge plus education cess

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Ankit Dangayach (Chartered Accountant) (691 Points)
Replied 29 October 2007

TDS u/s 194C is applicable as it is contract for work So Rate of TDS is 2%+SC+Cess So Rate is 2.266% for companies having profit in excess of 1 crores.