Briefly state the applicability of TDS provision and the effective rate of TDS in the following cases: (a) Rent paid for business premises by a partnership firm to individual X resident in India ₹ 3,60,000. (b) Call Cent

TDS applicability and effective rate of TDS Case Explanation (a) When a partnership firm has paid rent exceeding ₹ 2,40,000 for business premises during the previous year, such payment is liable for deduction of tax at source under section 194I @ 10%. The amount liable for tax deduction is ₹ 36,000. [₹ 3,60,000 x 10%] (b) In respect of payment to a payee engaged in the business of operation of call centre, tax is deductible at source @ 2% under section 194J. In this case, the payment exceeds ₹ 30,000 and therefore tax is deductible @ 2%. The amount liable for tax deduction is ₹ 1,200. [₹ 60,000 x 2%] (c) When packing material is manufactured as per the specification of the assessee and raw material is procured by job worker from other than from customer, it does not attract TDS. Therefore, no tax is deductible at source. (d) Commission paid when exceeds ₹ 15,000 tax is deductible at source @ 5% of the total amount. In this case the amount of commission is ₹ 70,000 for which the tax deductible at source would be ₹ 3,500. [₹ 70,000 x 5%] (e) Director sitting fee is liable for TDS under section 194J @ 10%. There is no threshold limit for non-deduction of tax at source. The tax deductible is ₹ 2,000 each in respect of the payment made to each director by way of sitting fee.