194 c of income tax

[Asked by Guest]

dear sir ,

i would like to know the provisions of section 194C of Income Tax Act.whats the percentage of income tax for individual contractors and the firms doing the contract works.
chakravarthy.s.n.

[Akash mahajan]

Hello sid,

Tds in case of an individual and huf is 1%

and for any other person, which includes your FIRMS, is 2%.

 

 

 

[AMIT JAIN, Advocate]

Dear Friend 

section 194C of I.T Act says about TDS rate. which is in the case of Individual & HUF is 1% but other than Individual & HUF is 2% .

 Thanks  Regards

[rinki todi]

TDS is to be deducted as follows:

• @ 1% when the contract payment is being made or credit is being given to an individual or an HUF
• @ 2% when the contract payment is being made or credit is being given to any person other than an individual or an HUF.

Point to be noted:

we have to check the status of deductee and not the deductor.

AI Summary

TDS on contract payments: deduction rate depends on payee status; deduct at payment or credit and verify deductee.
Section 194C requires deduction of tax at source on contract payments at differing rates depending on whether the payee is an individual or HUF or is some other person; the duty to deduct arises on payment or when the amount is credited, and the deductor must verify the deductee's legal status before applying the appropriate rate.