2. Income Tax Act 1961
Chapter XVII – Collection and Recovery of Tax
Section 190 to Section 234F
In Budget 2020 a new section 234G is inserted
(Late Fee Rs 200 for delay in Return prescribed u/s 35, 80G)
Section - 194A : Interest other than “Interest on securities”
Section - 194C : Payments to contractors
Section - 194H : Commission or brokerage
Section - 194I : Rent
Section - 194J : Fees for professional or technical services
TDS e-filing, Form 16A Generation, Correction of TDS Statements
Scope of this Program
3. 194C
Payments to contractors
Any person responsible for paying any sum
(Specified Person)
to any resident
for carrying out any work
(including supply of labour for carrying out any work)
in pursuance of a contract / sub contract
between the contractor and a specified person
To Whom applicable
4. When to deduct
at the time of credit of such sum (Accounting Date)
to the account of the contractor
or at the time of payment thereof in
cash or
by issue of a cheque or draft or
by any other mode,
whichever is earlier
Rate of TDS
Receiver of Payment / Deductee Rate of TDS
Individual / HUF 1%
Any Person other than Individual / HUF 2%
5. “Specified Person"
Central / State Govt
Local Authority
Any Corporation
by Central / State / Provincial Act
Any Company
Any Co-operative Society
Any Trust
Any University / Deemed University
Any society
Societies Registration Act, 1860 or
any law corresponding to that Act any firm
6. “Specified Person"
Any Government of a foreign State or
a foreign enterprise or
any association or
body established outside India
Any authority, engaged
Either
for the purpose of dealing with and satisfying
the need for housing accommodation
or
for the purpose of planning, development or
improvement of cities, towns and villages, or for both
7. “Specified Person"
any person,
Individual / HUF / AoP / BoI, if such person,—
(A) does not fall under any of the preceding sub-clauses;
and
(B) is liable to audit of accounts under clause (a) or
clause (b) of section 44AB
during the financial year immediately preceding the
financial year in which such sum is credited or paid to
the account of the contractor;
Position before Budget 2020
8. “Specified Person"
any person,
Individual / HUF / AoP / BoI, if such person,—
(A) does not fall under any of the preceding sub-clauses;
and
(B) “has total sales, gross receipts or turnover from business or
profession carried on by him exceeding one crore rupees in case of
business or fifty lakh rupees in case of profession”
during the financial year immediately preceding the financial
year in which such sum is credited or paid to the account of the
contractor;
Position after Budget 2020
9. Work
advertising;
broadcasting and telecasting including production of programmes for such
broadcasting or telecasting;
carriage of goods or passengers by any mode of transport
other than by railways;
catering;
manufacturing or supplying a product according to the requirement or specification
of a customer by using material purchased from such customer,
but does not include manufacturing or supplying a product according to
the requirement or specification of a customer by using material
purchased from a person, other than such customer.
but does not include manufacturing or supplying a product according to
the requirement or specification of a customer by using material
purchased from a person, other than such customer
Or Associate [Refer: 40A(2)(b)]of such companies
Pre
Budget
Post
Budget
10. Does Name has anything to do
Any sum u/s 194C
is credited to any account,
whether called
"Suspense account"
or by any other name,
in the books of account
of the person liable to pay such income (Specified Person)
such crediting shall be deemed
to be credit of such income
to the account of the payee
and the provisions of this section shall apply accordingly.
Note:
Direct credit to Party a/c Ledger is not necessary.
Provision Entry will also attract TDS.
Expenses Payable Account breakup list is necessary to identify party
11. TDS on Contract Payment
No TDS by Individual / HUF – Exclusively for personal purposes
Business of plying, hiring or leasing goods carriages,
If Contractor owns ten or less goods carriages (44AE) at any time during the
previous year and furnishes a declaration to that effect along with his PAN, to the
person paying or crediting such sum
Transaction / Payment Type Threshold Limit for NIL TDS
Single Amount
Credited / Paid /
likely to be credited or Paid
Rs 30,000/-
Aggregate of the Amounts
Credited / Paid /
likely to be credited or Paid
Rs 1,00,000/-
12. Codes used in RPU
94C for Section 194C
01 for Company 02 for Non Company
Reason for Lower / Higher / NIL Deduction
Code Category
A Lower / NIL Deduction Certificate u/s 197
C “PANAPPLIED”, “PANINVALID” or “PANNOTAVBL”
Higher TDS Rate for no PAN
T In case of Transporter transaction and valid PAN is provided
Y Within Threshold limit – Hence no TDS
Z Notified Organization u/s 197A (1F)
