Required Guidance & Suggestions

[Mayur Patel]

I am a proprietor of a firm engaged in website and software development.I have following concerns regarding GST and TDS for which i am seeking guidance from fellow expert of the community;

Question: is the following scenario correct ? | Am i eligible deductee for TDS ?

- I have raised invoice to my client for ₹ 1,00,000 where service charge is ₹ 84745.76 and GST(@18%) is ₹ 15254.24.

- Client paid me ₹ 90,000 ; Deducted ₹ 10,000 as TDS @ 10 % rate

It is to be noted that

- The location of supplier and place of supply of service is different from the State where the recipient is registered.(I have read that TDS under GST regime is not applicable for intra state supply of service,is that true ?)

- And,The client is eligible person to deduct TDS as his annual turnover is beyond ₹ 1 Cr. and is auditing his accounts.

I may be sound foolish asking question but i am not aware of taxation web for business.Any help regarding will be appreciated.

[Ganeshan Kalyani]

In my view your client has deducted TDS @10% under income tax. Such percentage of TDS is not there in GST . Also TDS under GST is deductible by the e commerce dealer.

[Alkesh Jani]

Sir, In terms of Section 51 of CGST Act, 2017 any Govt. Department, local authority etc are liable to deduct tax at source (TDS) and in terms of Section 52 of CGST Act, 2017, the electronic commerce operator is required to collect the tax at source (TCS).. I agree with the reply given by the expert

[KASTURI SETHI]

TDS under GST has been deferred under till 31.3.18. At present E-Commerce operator deducts TCS @1 % (0.5 +0.5 CGST and SGST) under Section 52 of CGST Act, 17. I support the views of both experts.

The querist is advised not to call himself, "sound foolish". On this forum even experts also ask questions. To quench your thirst of knowledge is neither sin nor offence from any stretch of imagination. Rather, it is plus point for you or any person.

[Mayur Patel]

I thank you all experts spared time for such a quick reply.

What i understood is that client can deduct TDS for technical service provided on total bill amount inclusive of GST (Rs. 1,00,000 ) and not only on service charge ( ₹ 84745.76 ).

[Ganeshan Kalyani]

TDS to be deducted on the amount before GST.

[Ganeshan Kalyani]

I agree with Sri Kasturi Sir 's view. The fact is no man can know all. That to in indirect tax it is not easy beacuse of frequent changes that happens by way of notification.

AI Summary

TDS under GST limited: specified authorities deduct, e commerce collects; routine payers generally not obliged to deduct GST TDS.
Whether a payer must deduct tax on payments for software and website development and whether GST is included in the withholding base. The replies distinguish income-tax withholding (as the likely 10% deduction observed) from the GST regime, under which tax is deducted at source only by specified government and local authorities and electronic commerce operators collect tax at source; routine private recipients are generally not required to deduct GST TDS. Experts advise computing any withholding on the value of supply exclusive of GST.