Section 194Q: TDS on purchase of goods:

-Applicable to the Buyer whose Turnover/Gross Receipts in the preceeding Financial year exceeds 10Cr. and aggregate amount of purchases from such particular buyer exceeds Rs.50L.

-TDS is required to be deducted @1% on the amount exceeding Rs.50L (The threshold limit of Rs.50L is to be reckoned from the beginning of the Financial year. i.e., 01.04.2021.)

-In the absence of PAN of the seller, TDS is required to e deducted @5%.

If TDS is required to be deducted u/s 194Q, then the provisions of section 206C(1H) will not prevail.

Section 206AB: Special provision for the deduction of TDS for Non filers of Income tax Return:

  • If any person who is required is deduct the TDS under the provisons of Chapter XVIIB of the Income Tax Act except under the following sections:
  • And the transaction is carried out with the specified person(who has not filed the income tax return for the two immediate preceeding financial years and whose time period for filing the same has been lapsed (i.e., 2018-19 and 2019-20)
  • Aggregate amount of TDS and TCS exceeds 50000 in each of the financial year. Then,

It is the responsibility of the deductor to ascertain the rate of TDS. For the purpose of this section, the Deductor will be required to take declaration regarding filing or non filing of Income Tax Return.

And the draft formats are enclosed below:

Format of Declaration for not imposing TDS Rate as per Section 206AB of the Income Tax Act, 1961

To Whom So Ever It May Concern

Declaration form for not imposing Rate as per Sec. 206AB of the Income Tax Act

I/We, ________________, having PAN ________________, am/are resident in India and hereby declare as follows:

Income Tax Returns for the below mentioned financial years have been duly filed by us within the prescribed time limit.

Financial Year Acknowledgment Number Date of filing the return
2018-19
2019-20
2020-21

The copy of the ITR acknowledgment of the above mentioned years have been duly enclosed.

I/We hereby declare that I/we am/are duly authorized to give this declaration and the information furnished above is true to the best of my/our knowledge. Further we would be responsible for any interest or penal consequences in case of any misdeclaration.

(Signature)

Name:

Designation:

Date:

Place:

The below format is applicable if the Income Tax return is not filed as mentioned above:

Format of Declaration for not imposing TDS Rate as per Section 206AB of the Income Tax Act, 1961 

To Whom So Ever It May Concern

Declaration form for not imposing TDS Rate as per Sec. 206AB of the Income Tax Act

1. Where I/We have not filed my Return of Income for both the preceding two Financial Years 2018-19 and 2019-20, I/We hereby confirm that the aggregate tax deducted and tax collected at source is /is not Rs. 50,000/- or more in each of the two preceding Financial Years 2018-19 and 2019-20.

2. I/We hereby declare that I/we am/are duly authorized to give this declaration and the information furnished above is true to the best of my/our knowledge. Further we would be responsible for any interest or penal consequences in case of any misdeclaration.

(Signature)

Name:

Designation:

Date:

Place:

Author Bio

Qualification: CA in Practice
Company: KLN & Co Chartered Accountants
Location: Vishakhapatnam, Andhra Pradesh, India
Member Since: 15 Oct 2020 | Total Posts: 2
Practicing CA in KLN & Co Chartered Accountants, Visakhapatnam. View Full Profile

My Published Posts

More Under Income Tax

5 Comments

  1. Arthanareeswaran says:

    Dear Madam,
    In the Format for second declaration, the preceding financial years are mentioned as 2019-20 & 2020-21 instead of 2019-19 & 2019-20.
    Kindly verify and correct if it is to be changed.
    Thanks & regards
    CA C.Arthanareeswaran B.Sc., F.C.A.,
    COIMBATORE – 641025

    1. Arthanareeswaran says:

      Kindly read the correct preceding financial years as 2018-19 & 2019-20 instead of 2019-19 & 2019-20.
      Sorry for the error.

Cancel reply

Leave a Comment to Arthanareeswaran

Your email address will not be published. Required fields are marked *

Search Posts by Date

September 2021
M T W T F S S
 12345
6789101112
13141516171819
20212223242526
27282930