Do I, as an individual, need to deduct TDS from the payments I made to a local contractor for a house construction? I and My Father have taken a home loan and made all payments through Online bank transfers. the work is not complete yet and there are more payments due to him. total cost of project is 55 lakh & paid till date 45 lakh
Jun. 23, 2017
Hello there. Welcome to Thakurani. I see you have a interesting question. I am Chiranjibi and I'm more than willing to help you with your query Section 194C deals with the deduction of TDS from the payment to be made to resident contractors from the amount of invoice raised by them with the rates 1% ( for individuals and HUF) and 2%( for others). However, exception has been provided for Individuals and HUFs who have hired a contractor for personal use. It means there is need to deduct TDS on the amount paid to the contractor. Considering the fact that the hose was constructed for personal purposes and not for commercial purposes, you don't need to deduct TDS for the payment made to your local contractor. ..........Chiranjibi Chapagain..........