TDS to be applicable on service amount excluding GST
The Central Board of Direct Tax has clarified that if GST amount is mentioned separately in contract or invoices tax shall be deducted at source on service amount excluding GST.
Illustration : Company A Pay office rent to Company B.
Company B raise a invoice to Company A.
Rent = 1,00,000/-
GST @18% = 18,000/-
Invoice amount= 1,18,000/-
Now Company A shall deduct tax on amount of Rs 1,00,000/-. As GST amount is separately mentioned on invoice, TDS not applicable on GST Component.
Refer : CIRCULAR No. 23 /2017
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