TDS on PURCHASE of GOOD
194Q. Deduction of tax at source on payment of certain sum for purchase of goods.
Any person, being a buyer who is responsible for paying any sum to any resident (hereafter in this section referred to as the seller) for purchase of any goods of the value or aggregate of such value exceeding fifty lakh rupees in any previous year, shall, at the time of credit of such sum to the account of the seller or at the time of payment thereof by any mode, whichever is earlier, deduct an amount equal to 0.1 per cent of such sum exceeding fifty lakh rupees as income-tax.
Important points in definition:
| Applicable | TO | Any person (buyer) Who is responsible for paying to any resident seller; for |
| Applicable | ON | Purchase of any GOODS |
| Applicable | WHEN | Value (aggregate) exceeding Rs. 50 lakh in P.Y. |
| Applicable | TIME | Earlier OF Credit into the account of the seller or Payment (by any mode) |
| Applicable | RATE | 0.10% (if no pan 5%) exceeding Rs. 50 Lakh |
| Applicable | EXCEPTION | Section shall not apply to- -TDS is deductible under any other section under Income Tax Act -TCS is collectible u/s 206C except 206(1H) |
Meaning of Buyer : Only for this section:
A person whose total sales, gross receipts or turnover from the business exceed Rs. 10 Crore During preceding Financial Year immediately preceding the financial year in which the purchase of good is carried out.
In Case of Difficulty : Arises in giving effect to this section
Board may, with the previous approval of the Central Govt issue guidelines for removing the difficulty.
Time of Payment:
Date of Payment of TDS : April to February – 7th of next Month
for the month of March- 30th April
Non-Compliance PENALTY : 30% Disallowance of value of transaction
FAQ:
Transaction Before 01/07/21 : 194Q – not apply on any sum credited or paid.
Threshold Limit : shall be computed from 1st April 2021.
Not Apply on : transaction at stock exchange
GST adjustment allowed.
