Individual assessee having turnover below Rs. 1 Crore, got the books audited u/s 44AD(5) [net profit shown below 8% of turnover] for F.Y. 2016-17. Whether TDS provisions are applicable to him for F.Y. 16-17 / 17-18?

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Individual assessee having turnover below Rs. 1 Crore, got the books audited u/s 44AD(5) [net profit shown below 8% of turnover] for F.Y. 2016-17. Whether TDS provisions are applicable to him for F.Y. 16-17 / 17-18?

An individual or a HUF, whose total gross receipts / turnover from the business or profession exceed the monetary limits specified under clause (a) or clause (b) of section 44AB [i.e. 1 crores / 50 Lakhs] during the financial year immediately preceding the previous year, shall be liable to deduct income-tax at source from relevant payments during the previous year. [Proviso to section 194A/C/H/I/J etc.]

 

Accordingly, if his turnover for F.Y. 2015-16 was above the monetary limits [i.e. 1 crores / 50 Lakhs], then TDS provisions shall be applicable to payments made by him during F.Y. 2016-17. TDS applicability has nothing to do with section 44AD.

Under the facts of the querist, no TDS shall be applicable to payments made during F.Y. 2017-18.

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