Section 194O - TDS on payments by E-commerce Operator to E-commerce Participant - Income Tax - Ready Reckoner - Income Tax

Section 194O - TDS on payments by E-commerce Operator to E-commerce Participant Time of Deduction:- Where sale of goods or provision of services of an e-commerce participant is facilitated by an e-commerce operator through its digital or electronic facility or platform (by whatever name called), such e-commerce operator shall, at the time of credit of amount of sale or services or both to the account of an e-commerce participant or at the time of payment thereof to such e-commerce participant by any mode, whichever is earlier, shall deduct tax at source. [ Section 194O(1) ] Rate of TDS From 01.10.2024 - 0.1% of gross amount of such sale or service or both. However if no PAN quoted, rate of TDS @5%. [ Substituted vide Finance (No. 2) Act, 2024 ] Upto 30.09.2024 - 1% of gross amount of such sale or service or both. However if no PAN quoted, rate of TDS @5%. If any payment made by a purchaser of goods or recipient of services directly to an e-commerce participant for the sale of goods or provision of services or both, facilitated by an e-commerce operator, shall be deemed to be the amount credited or paid by the e-commerce operator to the e-commerce participant and shall be included in the gross amount of such sale or services for the purpose of deduction of income-tax u/s 194O(1). [ Section 194O(1) ] Exception No Deduction of tax at source, Any sum credited or paid or likely to be credited or paid during the previous year to the account of an e-commerce participant, being an individual or Hindu undivided family , where the gross amount of such sale or services or both during the previous year does not exceed 5 lakh rupees and such e-commerce participant has furnished his Permanent Account Number or Aadhaar number to the e-commerce operator. [ Section 194O(2) ] Notwithstanding anything contained in Part B of this Chapter, E-commerce operator shall not be liable to tax deduction at source under any other provision of this Chapter A transaction in respect of which tax has been deducted by the e-commerce operator u/s 194O(1), or which is not liable to deduction u/s 194O(2). It shall not apply to any amount or aggregate of amounts received or receivable by an e-commerce operator for hosting advertisements or providing any other services which are not in connection with the sale or services referred to in section 194O(1). [ Section 194O(3) ] Meaning of certain term for the purposes of this section (a) electronic commerce means the supply of goods or services or both, including digital products, over digital or electronic network; (b) e-commerce operator means a person who owns, operates or manages digital or electronic facility or platform for electronic commerce; (c) e-commerce participant means a person resident in India selling goods or providing services or both, including digital products, through digital or electronic facility or platform for electronic commerce; (d) services includes fees for technical services and fees for professional services , as defined in the Explanation to section 194J . Power of CBDT to issue guidelines Guidelines issued for the purpose of removing the difficulty under section 194O vide Circular No. 13 of 2021 Dated 30/06/2021.