TaxTMI 
TaxTMI 
X is a sole proprietor. F.y 09-10= Turnover 45 lakh F.y 08-09= Turnover 39 Lakh F.y 07-08= Turnover 50 lakh He has paid a royalty of Rs 35,000/- to a company on march 25, 2009 without deducted TDS. Disallowance U/s 40(a)(ia) is applicable in the case or not?
TDS QUERY ?
11 Aug 2010 
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TDS liability on royalty requires deduction when preceding-year turnover exceeds threshold; failure triggers disallowance under tax law.
Royalty paid by a sole proprietor without TDS is subject to statutory disallowance if, for the financial year in which the payment was made, the immediately preceding year's turnover exceeded the monetary threshold that creates an obligation for an individual or HUF to deduct tax at source; identification of the relevant previous year and its turnover therefore determines whether the disallowance provision applies. (AI Summary)
Royalty paid by a sole proprietor without TDS is subject to statutory disallowance if, for the financial year in which the payment was made, the immediately preceding year's turnover exceeded the monetary threshold that creates an obligation for an individual or HUF to deduct tax at source; identification of the relevant previous year and its turnover therefore determines whether the disallowance provision applies. (AI Summary)