Tax Deduction at Source (TDS)
Authorities to deduct tax at source( TDS) - the Deductor
(a) A Department or Establishment of Central Government or State Government; or
(b) Local Authority; or
(c) Government Agencies; or
(d) Such persons or category as may be notified by the Government
- No TDS if location of supplier and place of supply is in a State or UT which is different from the State or UT of registration of recipient.
- To deduct tax at the rate of 1 % SGST + 1 % CGST from the payment made or credited to the suppliers (the Deductee) of taxable goods or services or both, where the total value of such supply, under a contract, exceeds two lakh and fifty thousand rupees.
1 % SGST + 1 % CGST = TOTAL TDS -- 2%
Time limit to furnish such certificate in GSTR-7A & penalty thereof: Refer [Section 51 (4)]
- within 5 days of crediting the amount to the appropriate Government.
If failed to furnish, he shall be liable to pay a late fee, a sum of Rs. 100 / day from the day after the expiry of 5 day period until the failure is rectified.
- Amount of late fee payable shall not exceed Rs. 5,000/-.
Claiming credit of TDS:
- Amount of TDS to be reflected in return of deductor.
- Deductee shall claim credit, in his electronic cash ledger, of the amount of TDS.
Interest liability on deductor:
- If any deductor fails to pay amount of TDS, he shall be liable to pay:
- Interest in accordance with the provisions of section 50 and
- The amount of tax deducted.