Cash payment to contractor

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  1. Raveesha DT

    Raveesha DT New Member

    Dear Sir/madam,

    Can an individual make cash payment more than Rs,20,000/- to individual contractor for the purpose of construction of residential house?

    Also clarify whether an individual is responsible for deduct TDS from (individual)contractor?
     
  2. Rahul

    Rahul Active Member

    Yes, you can make payments the Contractor exceeding Rs. 20,000. The ceiling of Rs.20,000 is for businesses where payments made in excess are disallowed and not for Individuals.

    As to deduction of TDS, if the payment that is being made to the contractor does not exceed Rs. 30,000, No TDS on payment to contractor is required to be deducted. However, if the total of all such payments made or to be made during a financial year exceeds Rs. 75,000; TDS shall be deducted under Section 194C
     
  3. Raveesha DT

    Raveesha DT New Member

    Thanks Rahul,
    My query is as an individual whether I am liable to deduct TDS from contractor.
    I am constructing residential house, for that I engaged a contractor.
    Somebody told me that individuals are not liable to deduct TDS.
    Please clarify.
     
  4. Manoj Mehra

    Manoj Mehra Active Member

    @Raveesha DT : Individuals are not required to deduct any TDS from payment to contractor.

    Only Individuals in Business with turnover of more than 25 Lakhs/ 1 Crore are required to deduct TDS
     
  5. Raveesha DT

    Raveesha DT New Member

    Dear Members,

    Any comments on both reply with regard to TDS.
    Who is right, Mr.Manoj or Mr.Rahul?
     
  6. Manoj Mehra

    Manoj Mehra Active Member

    @Raveesha DT

    Both of us have said the same thing.

    Rahul has mentioned the rules for TDS Deduction for those taxpayers on which Tax Audit is applicable.

    And I have only added that in case Tax Audit is not applicable - TDS will not be deducted.
     
  7. md aminul islam

    md aminul islam New Member

    rejes constraction pales a bill Rs 100000 in my institution , what is the tax of rajesh constraction and is it treat as individuals ,
     
  8. md aminul islam

    md aminul islam New Member

     
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