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TDS on Payment to transporter

Today we discuss on the provision of the TDS on Payment to transporter. what is the rate of the tds on contractor , under which section it will cover and when applicability of deducting tds on transporter will arise. In this blog we will discuss tds on transporter in details.

TDS on Payment to transporter is deducted under  section 194C of income tax act 1961.

Who will deduct the TDS under section 194 C?

Any person who is paying the payment to the transporter is liable to pay tds, provided further TDS provision is applicable to them. TDS is applicable to the LLP,Company,firm but for proprietorship and HUF concern only if he has audited in the previous financial year.


Applicability of TDS deduction on transporter?

TDS will be deducted if any payment made to the single transporter exceeding Rs 30,000 in a single payments and 75,000 for a complete year payments.  If you have paid less than 75000 in a whole year and single payments less than 30,000 to 10 different transporter than no need to deduct the TDS.

Exemption of TDS on transporter

With effect from 1st June 2015 exemption of TDS deduction is allowed for small transporter, small transporter means transporter should not own more  than 10 vehicles at any time during the financial year.

Condition to claim exemption for TDS on Payment to transporter

1 Need a Pan card copy of the transporter

2 Need a declaration of the transporter that he has not own more than 10 vehicle in a whole year. Declaration should be on the letter head of the company

Note – A driver can not give the declaration, declaration will needed of the person who is issuing bill and Bill of lading copy.

Rate of TDS in 194C

Rate of TDS on Payment to transporter will be

If transporter is company 2%
If transporter is other than company (individual/HUF/LLP/Firm etc 1%




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