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

[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

Manpower company queries if TDS applies to total invoice with GST or just base amount; Section 51 in focus. A manpower supply company is seeking clarification on whether tax deducted at source (TDS) should be applied to the total invoice amount, including GST, or just the base amount. The consensus among respondents is that TDS should be calculated on the base amount of 100,000, excluding GST. One respondent notes that Section 51 of the CGST Act regarding TDS is not yet in force, so TDS may not apply currently. Another highlights a CBDT circular clarifying that TDS should exclude the GST component when GST is separately indicated in the invoice.