Any payment made to an advertising agency (contractor) is liable for a TDS under section 194C. Here we have discussed the TDS on advertisement covered under section 194C. It includes deductions on payments made to advertising agencies for publishing newspapers, magazines, canvassing advertisements and others. Learn more.
Section 194C of the Income Tax Act states that if any person makes a payment to a contractor to carry out a particular work, inclusive of labour supply, then he/she has to make a TDS deduction. So, if you pay an amount to an advertising agency in pursuance of a contract, they must deduct a TDS on advertisements.
The following individuals are eligible to make TDS deductions as per Section 194:
The meaning of work under Section 194C is as follows:
Also Read: New Tax Regime Under Section 115BAC
As per Section 194C of the IT Act, a sub-contractor is someone who:
Those making a payment to a contractor or sub-contractor as per Section 194C of the IT Act has to deduct TDS:
While applying TDS on advertisements, keep the following rates in mind for correct calculation:
You don’t need to deduct a TDS under Section 194C under these cases:
Advertisement can be in both electronic and print medium. In such cases, TDS deduction will take place at 1% of the amount paid for advertisement, including the production of programmes for broadcasting or telecasting that are to be used for such advertisements.
For all other telecasting or broadcasting, including the production of programmes used for such broadcasting or telecasting the TDS deduction will take place at 2% of the payment amount.
Although ‘advertising’ is not clearly defined in the IT Act provisions, TDS deduction on advertisement will take place for the following situations:
The above is an in-depth guide on Section 194C covering TDS on advertisements. So if you are paying a contract amount of more than Rs. 30,000 to an advertising agency follow the instructions mentioned above. In addition, you can find details like applicable tax rate, exceptions, calculation process, etc.
1. What is the due date of depositing tax deducted at source under Section 194C?
Follow the below structure to deposit TDS on time:
2. What conditions must one meet to apply Section 194C?
The following are conditions that ensure whether the Section of the Income-tax is applicable or not:
3. Is having a contract a requirement for applying TDS on advertisement?
Yes, having a legitimate contract binding by law is one of the requirements for applying TDS on advertisements. So, if there is no contract between two parties (person and contractor/sub-contractor), TDS is not applicable.
4. What is the due date for issuing the TDS certificate?
According to provisions of Income Tax Act, if you deduct TDS under Section 194C, then you need to issue the TDS certificate within 15 days of filing of fourth quarter TDS return.
This article is solely for educational purposes. Navi doesn't take any responsibility for the information or claims made in the blog.
|Section 112A||Section 50||Section 245|
|Section 80QQB||Section 32AD||Section 250|
|Section 35D||Section 143 (1a)||Section 115BAB|
|Section 143||Section 79||Section 140A|
|Section 17(2)||Section 3||Section 94A|
|Section 147||Section 80||Section 40A|
|Section 48||Section 115AD||Section 14A|
|Section 45||Section 285BA||Section 6|
|Section 36||Section 87A||Section 80GGA|
|Section 244A||Section 234E||Section 28|
|Section 197||Sectio 548||Section 194J(1)(ba)|
|Section 145A||Section 80P||Section 92CD|
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