TDS ON PURCHASE OF GOODS 194Q

TDS ON PURCHASE OF GOODS-194Q-PART-2

Laxman:- What is this new Section 194Q, which is Confusing our Traders?

Ram: - Section 194Q provides an obligation on Qualified buyer to deduct taxes at source (TDS) at the rate of 0.1% on purchase of goods from resident Indian

Laxman:Who is a "Qualifed Buyer" bhaiya?

Ram: - A person whose turnover/gross receipts exceeds INR 10 Crores during the immediately preceding financial year.

(for e.g. If Goods purchased in FY 2021-22, then the turnover for FY 2020-21 should have exceeded INR 10 Crores to qualify as buyer)

Laxman:What is the threshold limit for TDS Deduction for the Qualified Buyer ?

Ram: - Aggregate value of goods Purchase exceedsINR 50 Lacs during the Previous Year (FY 2021-22 in above example)

Laxman:When to deduct TDS?

Ram: - Tax shall be deducted at the time of credit or payment whichever isearlier

Laxman:Whether any exemptions allowed bhaiya?

Ram: - Yes 2 Exemptions given.

When the transaction is subject to Tax deducted at source under other provisions of the Act;
When the transaction is subject to tax collected at source(TCS) under Section 206Cother than Section 206C(1H)

Laxman :Can you revise me what was section 206C 1H made applicable from 1^st Oct 2020?

Ram: - Yes I share you a snap shot of both sections more better interpretation.


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