TDS on Purchase vs TCS on Sales of Goods

View News

Submit Query

01 Dec 2022

TDS on Purchase vs TCS on Sales of Goods

TDS on Purchase vs TCS on Sales of Goods

Section 194Q	Section 206C
Applicable from 1st July 2021	Applicable from 1st October 2020
‘Buyer’ having turnover exceeding Rs. 10 Crores in the immediately preceding Financial Year require to deduct TDS at the rate of 0.1% of the purchase value above INR 50 Lakhs at the time of Payment or credit, whichever is earlier.	‘Seller’ having turnover exceeding Rs. 10 Crores in the immediately preceding Financial Year require to collect TCS at the rate of 0.1% on receipt of consideration above INR 50 Lakhs from Buyer on Sale of any goods.
Point of taxation Whichever is Earlier Invoice amount credit to the account of the seller payment made to the seller	Point of taxation On receipt of consideration

**As per amendment to the provisions of section 206AA if the Seller does not provide PAN then the applicable rate of TDS under section 194Q shall be 5% instead of 0.1%.

**The provision that has been brought at this time is only in relation to “sale of goods” and services have been kept away from this provision.

Override Mechanism

Section 194Q shall override section 206C(1H) and hence in such a case only the buyer is needed to deduct TDS and the seller need not to required collect TCS under section 206C (1H).