Ad-Free CAclubindia and Daily Updates on your mobile. Subscribe Now!

TDS u/a 194Q

Mohit Agrawal (AUDIT MANAGER) (104 Points)

31 July 2021

A Machine having worth Rs. 5,05,000,00/- to be purchased from Seller A. Advance Payment details are as below –

Rs. 1,02,000,00/- have been paid before 31.03.2021.

Rs. 1,00,000,00/- to be paid in Aug. 2021.

Rs. 3,03,000,00/- to be paid in Sept. 2021 after delivery of Machine & Invoicing.

Please suggest amount of TDS to be deducted u/s 194Q ?

Reply
Follow
Share

5 Replies

CA. Sourav Sarkar (Chartered Accountant ) (24583 Points)
Replied 31 July 2021

Yes TDS under section 194Q is applicable as purchase value exceeds 50 lakhs rupees

Upgrade to CAclubindia Pro. Subscribe Now!

Mohit Agrawal (AUDIT MANAGER) (104 Points)
Replied 31 July 2021

0.1% of which value ?

When TDS to be deducted i.e at the time of advance payment or at the time of Booking of Invoice ?

CA. Sourav Sarkar (Chartered Accountant ) (24583 Points)
Replied 31 July 2021

At the time of payment to supplier or at the time of credit to his account whichever is earlier.

0.1% of purchase value

CMA Poornima Madhava (CMA) (13112 Points)
Replied 31 July 2021

Tax u/s 194q to be deducted at source at the time of payment or credit whichever is earlier. Further, CBDT vide it's circular has clarified that if payment has been made prior to 1st July 2021, no TDS in respect of the same.

Hence, you are required to deduct tax at source on the balance payments that you intend to make in aug and sep.