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TDS Under Section 194J(a) & 194J(b)

The existing section code 194J (i.e. Fees for Professional or Technical Services) has been sub-divided now into two sections, 194J(a) and 194J(b), effective from August 7 2020. u/s 194J(a) of the Income Tax Act, is related to TDS deduction on fees for Technical Services, and u/s 194J(b) of the Income Tax Act is related to TDS deduction on fees for Professional Services. Every person excluding an individual or a HUF, making payment to a resident for notified services, will be covered u/s 194J(a) & 194J(b) in the Income Tax Act.

  • Payments that are being covered u/s 194J(b)
    • Professional services
    • Royalty etc…
  • Tax Deduction Rate
    • Tax deduction rate for u/s 194J(a) is 2% and for 194J(b) is 10%
    • In case of payee fails to furnish PAN, he will be liable to pay TDS at the rate of 20%
  • Threshold Exemption Limit
  • In case of payment does not exceed the directed Threshold exemption limits, TDS will not be deductible. TDS is required to be deducted if the amount of payment in a year exceeds Rs. 30,000. However, Threshold exemption limit is not available only in the case of Fees / Commission / Remuneration paid to director of the company, other than Salary.

Do you want to file a TDS return? You contact us

SWAMISHARAN N PATEL
( ADVOCTAE & TAX CONSULTANT)
02640-221775, M. 9426472875

 
     
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