Section 149Q (TDS on purchase of Goods)

TDS ON PURCHASE OF GOODS U/S. 194Q | by Sachin Kumar Bangre | LinkedIn

Introduction of Section 149Q

The government of India has given notice to all to deduct TDS on the purchase of goods from 1st July 2021. If a resident person buys goods in excess of the Threshold limit, then TDS will be levied on the purchase of goods by the seller @ 0.1%

This section will be applicable on the purchase of all goods in India from July-1st-2021, i.e. whoever buys goods in excess of the Threshold limit, then section 149Q will be applicable.

When to deduct TDS?

(a) at the time of credit of such sum to the account of the seller

(b) At the time of payment there of by any mode whichever is earlier

What is the threshold limit rate of TDS in case of purchase of goods?

Exceeding purchase of rupees 50 Lakh in a financial year.

TDS Rate applicable on @0.1%

The total turnover of a company in a financial year is more than 10 crores

For the person who does not have PAN number, TDS rate is applicable at higher rate that means TDS is applicable at 5%

Section 149Q will not apply to which person?

(a) The tax is deductible under any of the provisions of this Act

(b)Tax is collectible under the provisions of section 206C other than a transaction to which subsection (1H) of section 206C applies. (It refers to TCS section)

Special points**** Section 149Q is applicable only for the purchase of goods and not services, In this, we have to deduct TDS on the original price of any such goods on which the amount of GST has not been added.