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TMI BlogTDS deducted on total amount or only o service chargeX X X X Extracts X X X X X X X X Extracts X X X X ..... Dear sir We have paid TDS on contractor as below for years. MANDAY 20,130 OT 4,767 TOTAL 24,897 PF 13.61% 548 PF 12% 483 SUB TOTAL 24,414 Service Charge 10% 2,490 Service tax 10% 249 Ed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u 3% 7 Payable 27,160 TDS 1% 272 TOTAL 26,889 We have deducted TDS on total amount ( which is mandays , over time, service tax all is included) But contractor worker 's salary is monthly below than 4,500 Rs, so that TDS not applicable. But we've deducted from total amount, so tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t TDS is deducted from contractor worker's salaries also. So, that I think it is unfair. so my suggestion is like this. MANDAY 20,130 OT 4,767 TOTAL 24,897 PF 13.61% 548 PF 12% 483 SUB TOTA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... L 24,414 Service Charge 10% 2,490 Service tax 10% 249 Edu 3% 7 Payable 2,490 TDS 1% 25 TOTAL 27,135 We ded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uct TDS only from service charge which is conractor labour's profit. Can you guide us which case is correct ? and as per rule, which one is the right one.. - Reply By MOHAN S - The Reply = One must read Section 194C to see the answer. Section 194C starts with the word "Any sum payable to a contractor..... So I am unable to accept TDS is applicable only on service charge and not on wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ole amount. This view is incorrect and against the provisions of law. The TDS has to be deucted on the gross amount paid including Sevice Tax as Central Board of Direct Taxes has clarified that "Service Tax" can be excluded only in respect of payments u/s 194I Payment towards "Rent" - Reply By yujin kim - The Reply = Dear sir I read 194C . but not mentioned detail deduct on which amou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. I agree we should deduct service tax included amount. But I don't understand why deduct from total amount.(worker's manday, overtime also included.) so that my suggestion is as below. MANDAY 20,130 OT 4,767 TOTAL 24,897 PF 13.61% 548 PF 12% 483 SUB TOTAL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 24,414 Service Charge 10% 2,490 Service tax 10% 249 Edu 3% 7 Payable 2,746 TDS 1% 27 TOTAL 27,133 I deducted TDS on service charge + service tax total amount Can u please tell me whether my suggestion is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... correct? Waiting for your reply. - Reply By MOHAN S - The Reply = Mr.Kim, I clarify that the tax u/s 194C has to be deducted on the total amount paid to the contractor. If the payment is toeards any reimbursement there the contractor has to produce the Evidence of such expenses. if the same is to be excluded. Otherwise the Tax has to be deducted on the Gross Amount only and this has been cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arified several times by the department. If you deduct tax only on Service Charge you are likely to get notice from the department once you file the TDS return. So take care. - TDS deducted on total amount or only o service charge - Query Started By: - yujin kim Dated:- 22-3-2012 Income Tax - Got 3 Replies - Income Tax - Discussion Forum - Knowledge Sharing, reply post by an expert, personal o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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