If the aggregate amount paid/credited or likely to be paid/credited to a contractor or sub-contractor exceeds Rs 75,000 during a financial year, tax should be deducted at source under Section 194C of the Income Tax Act, said K Satyanarayana, Chief Commissioner of Income Tax (Karnataka-Goa).
At a seminar on revised provisions on the Tax Deducted at Source (TDS), Satyanarayana said a major part of the I-T revenue comes from TDS.
Hence, the drawing and disbursing officers should be very cautious while calculating TDS.
The TDS at a higher rate, that is 20 per cent, has to be deducted if the deductee does not provide PAN to the deductor, he said.
He said TDS should be credited to the government account within seven days from the end of the month in which deduction/collection is made in Form 281.
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