TaxTMI 
TaxTMI 
We have paid amount of Rs:90,000/- towards hire Charges upto 30-9-2009 but we have not deducted TDS U/s.194I, and in the month of October, 2009 we have paid an amount of Rs:50,000/-. So, whether we have to deduct TDs @ 2% on whole or 10% on payment made before 30-9-2009 and 2% after september,2009. Please advice
Applicability of rate in TDS
BHASKER MURALI
Clarification on TDS rates for hire charges: Old rate before 1st Oct 2009, new rate after; Section 194I may apply. A query was raised about the correct rate of Tax Deducted at Source (TDS) applicable to hire charges paid before and after 1st October 2009. The initial payment of Rs. 90,000 was made before 30th September 2009 without TDS deduction, and Rs. 50,000 was paid in October 2009. One response clarified that TDS should be deducted at the old rate for payments before 1st October 2009 and at the new rate thereafter. Another response agreed but noted that if the total payment was unlikely to exceed Rs. 120,000 annually, TDS might not be required under section 194I. (AI Summary)