On what Value tax to be deducted at source (TDS)

[Asked by Guest]

Hi all,

We are man power supplying company (Except Security personnel we provide all kind of manpower) we are subjected to charge GST @18%

My Doubt is when we raise our bill like mentioned below:

Manpower supply Charges 100000

SGST @ 9% 9000

CGST @ 9% 9000

Total value 118000

Here, the doubt is whether the recipient of service should deduct tax at source @ 2% on 100000 or 118000.

Kindly Clarify my doubt.

Thanks in advance:-)

Rgds

Sridharan

[KASTURI SETHI]

The value of supply shall be taken as the amount excluding CGST, SGST, IGST, UTSGST. TDS is i.e. on 100,000/- .

[Rajagopalan Ranganathan]

Sir,

Section 51 of CGST Act, 2017 provides for 'Tax deduction at source. " However this section is not brought into force till today. Therefore the question of deduction of tax at source will not arise at present.

[Ganeshan Kalyani]

Dear Visu, please clarify whether you mean TDS of Income tax act or GST act. From your query i believe you are referring income tax tds. If it is correct then TDS will be deducted on basic value i.e. excluding GST.

[Hariharan Sundaram]

Views of Kalyanji is correct. As per CBDT circular 23/2017 dated 19th july modifying the earlier circular 1/2014, has clarified that wherever in terms of the agreement or contract between the payer and the payee, the component of 'GST on services' comprised in the amount payable to a resident is indicated separately, tax shall be deducted at source under Chapter XVIl-B of the Act on the amount paid or payable without including such 'GST on services' component.

[NAGAPEDDESWARARAO TIRUVEEDULA]

Dear sir,

please note :-

TDS is Deducted 2% on 1,00,000/- only for companies & TDS is Deducted 1% on 1,00,000/- for Non-Companies

Regards

tnprao

AI Summary

Tax deduction at source should be calculated excluding separately stated GST, under income-tax TDS guidance.
Where GST is indicated separately on the invoice, tax deduction at source under income-tax TDS rules is to be made on the amount excluding GST; the GST-specific TDS provision was not in force at the time, and administrative guidance confirms the exclusion of separately stated CGST/SGST/IGST from the TDSable base.