Tds deductibility at various sections

[poorna chandar]

My company is Film producing company we are doing shooting at various places like Resorts and Film city, but while final payment to those persons they are asking us to pay TDS they are negotiating at Nett of TDS. my doubt is whatever the payment am giving on the consolidated bill which is inclusive of all services like boarding ,lodging,renting of machienary,professional services which will attract for TDs under various sections at various rates whether shall i need to deduct at respective sections or shall i treat as a contractor to deduct under 194 C. if i need to deduct under 194C What are the requirements i have to do.

[Mukesh Kumar]

You need to deduct TDS on the gross amount paid. TDS can not be deducted on nett amount. All the contractors and service providers must be told that the benefit of TDS is to be availed by them and therefore, they should not insist on nett amount. Yes, I agree that this type of arrangement are routine in international transactions but, must be avoided in home transactions.

AI Summary

TDS on gross payments must be deducted; payees cannot insist on net-of-TDS settlements, apply withholding to gross amounts. TDS must be calculated and deducted from the gross amount payable; payees cannot demand net-of-TDS settlements. For consolidated bills covering boarding, lodging, equipment rental and professional services, the payer should apply applicable withholding rules to the gross consideration attributable to those services rather than treating the supply solely as a contractor payment, and must inform payees that withholding is the payer's compliance obligation.