If the invoice clearly separates the value of goods and services, then:✅ TDS is applicable only on the service component, as TDS is not deductible on the purchase of goods.✅ No TDS on the goods portion, as per the CBDT Circular No. 715 (1995) and various case laws. Check the contract terms to determRead more
If the invoice clearly separates the value of goods and services, then: ✅ TDS is applicable only on the service component, as TDS is not deductible on the purchase of goods. ✅ No TDS on the goods portion, as per the CBDT Circular No. 715 (1995) and various case laws.
Check the contract terms to determine if it falls under works contract or pure goods purchase.
if it falls under the works contract then TDS u/s 194 C will be deducted.
If you are purchasing ready-made T-shirts with your company logo printed on them, it is treated as a purchase of goods. No TDS is required under Section 194C (TDS on contracts) or Section 194J (TDS on professional services). GST might apply, but TDS is not applicable under the Income Tax Act.
If you are purchasing ready-made T-shirts with your company logo printed on them, it is treated as a purchase of goods.
No TDS is required under Section 194C (TDS on contracts) or Section 194J (TDS on professional services).
GST might apply, but TDS is not applicable under the Income Tax Act.
No, SAI is not considered a local authority under the Income Tax Act. As per Section 10(20) of the Income Tax Act, a local authority includes:✅ Panchayats under Article 243(d) of the Constitution.✅ Municipalities under Article 243P.✅ Municipal Committees, District Boards, or similar authorities respRead more
No, SAI is not considered a local authority under the Income Tax Act.
As per Section 10(20) of the Income Tax Act, a local authority includes: ✅ Panchayats under Article 243(d) of the Constitution. ✅ Municipalities under Article 243P. ✅ Municipal Committees, District Boards, or similar authorities responsible for local governance and civic functions.
Hence, SAI is an Autonomous Body with No Local Governance Role and neither has any Statutory Authority for Local Self-Governance. It operates under the supervision of the Ministry of Youth Affairs & Sports, Government of India.
Many businesses in India wonder whether an invoice must be signed or if a system-generated invoice is legally valid. Let’s break it down from both GST and Income Tax perspectives. 1. GST Rules on Invoice Signatures As per Rule 46 of the CGST Rules, 2017, an invoice must contain specific details suchRead more
Many businesses in India wonder whether an invoice must be signed or if a system-generated invoice is legally valid. Let’s break it down from both GST and Income Tax perspectives.
1. GST Rules on Invoice Signatures
As per Rule 46 of the CGST Rules, 2017, an invoice must contain specific details such as: ✅ Supplier’s Name & Address ✅ GSTIN ✅ Invoice Number & Date ✅ Description of Goods/Services ✅ Taxable Value & GST Amount
However, a physical signature is NOT mandatory if the invoice is issued electronically. Businesses can simply add a note stating: 📝 “This is a system-generated invoice and does not require a signature.” Here Computer generated means generated through a computer System/application.
What About E-Invoicing?
For businesses with a turnover of ₹5 crore or more (from 1st August 2023), e-invoicing is mandatory. These invoices are digitally signed by the Invoice Registration Portal (IRP), making a physical signature unnecessary.
2. Income Tax Perspective on Invoice Signatures
The Income Tax Act, 1961, does not prescribe any format for invoices, nor does it require a signature. However, invoices should contain necessary details to support expenses or revenue for tax assessments.
For Tax Audit Cases (Section 44AB): No requirement for a signature, but proper record-keeping is necessary.
For TDS Deductions: A signed invoice is not mandatory, but details must be accurate for compliance.
For Books of Accounts (Section 44AA): Invoices serve as supporting documents, but again, no signature is required.
3. When Should You Sign an Invoice?
Although signatures are not mandatory, some situations may require them: ✔️ Export Transactions: Foreign clients may request a signed invoice. ✔️ Government Contracts: Some government departments require physical signatures. ✔️ Legal Disputes: A signed invoice can provide stronger evidentiary value.
Conclusion: What Should You Do?
For most businesses, a computer-generated invoice with a disclaimer is legally valid. If required, businesses can use digital signatures (DSC) or scanned signatures instead of manual signing.
👉 Recommended Disclaimer for Your Invoices: 📌 “This is a system-generated invoice and does not require a signature.”
This ensures compliance while keeping your invoicing process efficient.
As per Section 3(1) of the Act, labour cess is levied at 1% of the "cost of construction." Cost of Construction Includes (Rule 3 of the Cess Rules, 1998) ✅ Material Cost – Cost of raw materials used in construction✅ Labour Cost – Wages and salaries paid to workers✅ Hire Charges – Rent for machineryRead more
As per Section 3(1) of the Act, labour cess is levied at 1% of the “cost of construction.”
Cost of Construction Includes (Rule 3 of the Cess Rules, 1998)
✅ Material Cost – Cost of raw materials used in construction ✅ Labour Cost – Wages and salaries paid to workers ✅ Hire Charges – Rent for machinery and equipment ✅ Architectural & Design Fees – Payments to consultants, engineers, and designers ✅ Contractor’s Bills – Total contract value for civil work
Cost of Construction Excludes
❌ Land Cost – Purchase price or lease rent of land ❌ Compensation to Workers – Paid under the Workmen’s Compensation Act ❌ GST Component – Indirect taxes levied under GST
Labour Cess on Supply and Service Cost with GST
Labour Cess is not levied on GST; it is calculated on the pre-tax cost of construction.
If a construction contract includes both supply and services, the cess is applied to the total contract value before adding GST.
Example Calculation:
Supply Cost (Materials): ₹50,00,000
Service Cost (Labour, Machinery, etc.): ₹30,00,000
The Building & Other Construction Workers’ Welfare Cess (BOCWW Cess) is a levy imposed on the construction costs incurred by employers for building and other construction activities. As per Section 2(1)(d) of the Building and Other Construction Workers (Regulation of Employment and Conditions ofRead more
The Building & Other Construction Workers’ Welfare Cess (BOCWW Cess) is a levy imposed on the construction costs incurred by employers for building and other construction activities.
As per Section 2(1)(d) of the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, read with Section 2(d) of the Building and Other Construction Workers’ Welfare Cess Act, 1996, the term “building or other construction work” has a broad scope. It includes activities such as construction, alteration, repairs, maintenance, and demolition related to various structures, including buildings, streets, roads, railways, airfields, irrigation systems, drainage works, flood control projects (including stormwater drainage), power generation and distribution, waterworks, oil and gas installations, electric lines, telecommunication networks, dams, canals, tunnels, bridges, pipelines, transmission towers, and cooling towers. The government may also specify additional construction works through notifications. However, it excludes any construction activities covered under the Factories Act, 1948, or the Mines Act, 1952.
The BOCWW Cess is imposed on the total construction cost incurred by employers. As per Sections 3(1) and 3(3) of the Building and Other Construction Workers’ Welfare Cess Act, 1996, along with Notification No. S.O. 2899 dated 26.09.1996, the cess is charged at 1% of the total construction cost.
Shareholders' liability is limited to their shareholding in the company. They are not personally responsible for the company's debts or actions beyond the unpaid amount, if any, on their shares. However, shareholders may face personal liability if they engage in fraudulent activities. In the case ofRead more
Shareholders’ liability is limited to their shareholding in the company. They are not personally responsible for the company’s debts or actions beyond the unpaid amount, if any, on their shares.
However, shareholders may face personal liability if they engage in fraudulent activities. In the case of companies with unlimited liability, shareholders can be held responsible up to the amount they agreed to contribute to the company’s assets in the event of winding up. Shareholders who also serve as directors may have additional legal responsibilities.
Yes, TDS is applicable to transporters under section 194c, with @1% for individuals/HUF and @2% for others. Yes, the exemption is also available to the transporter of goods. As per Section 194C(6) 0f the Income Tax Act, 1961 "No deduction shall be made from any sum credited or paid or likely to be cRead more
Yes, TDS is applicable to transporters under section 194c, with @1% for individuals/HUF and @2% for others.
Yes, the exemption is also available to the transporter of goods.
As per Section 194C(6) 0f the Income Tax Act, 1961 “No deduction shall be made from any sum credited or paid or likely to be credited or paid during the previous year to the account of a contractor during the course of business of plying, hiring or leasing goods carriages, [where such contractor owns ten or less goods carriages at any time during the previous year and furnishes a declaration to that effect along with] his Permanent Account Number, to the person paying or crediting such sum.”
Hi, I am breaking your question into multiple pieces to make it easier to understand. Payment to Nonresident Taxable Person (NRTP) Section 2(77) of CGST Act, 2017 says that a Non-Resident Taxable Person means "any person who occasionally undertakes transactions involving the supply of goods or serviRead more
Hi,
I am breaking your question into multiple pieces to make it easier to understand.
Payment to Nonresident Taxable Person (NRTP)
Section 2(77) of CGST Act, 2017 says that a Non-Resident Taxable Person means “any person who occasionally undertakes transactions involving the supply of goods or services, or both, whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India.”
Requirement of Registration in India
Section 24 of the CGST Act, 2017, required NRTP to register under GST law mandatorily five days before the commencement of the business irrespective of the minimum threshold turnover limit.
Applicability of RCM
Since NRTP requires the registration, he has to deposit tax in advance, equivalent to the estimated tax liability calculated on the value of taxable supply for the period for which the registration has been obtained.
Conclusion: GST should be paid under forward charge, not under reverse charge.
Here is the step-by-step process for making payment for TDS on immovable property. Go to the login page of the official Income Tax website (https://eportal.incometax.gov.in/iec/foservices/#/login?language-code=en) log in to your account Navigate to the "E-file" section and select 'e-pay Tax In the 'Read more
Here is the step-by-step process for making payment for TDS on immovable property.
How to deduct TDS if invoice contain both goods and service component?
If the invoice clearly separates the value of goods and services, then:✅ TDS is applicable only on the service component, as TDS is not deductible on the purchase of goods.✅ No TDS on the goods portion, as per the CBDT Circular No. 715 (1995) and various case laws. Check the contract terms to determRead more
If the invoice clearly separates the value of goods and services, then:
✅ TDS is applicable only on the service component, as TDS is not deductible on the purchase of goods.
✅ No TDS on the goods portion, as per the CBDT Circular No. 715 (1995) and various case laws.
Check the contract terms to determine if it falls under works contract or pure goods purchase.
if it falls under the works contract then TDS u/s 194 C will be deducted.
See lessIs TDS deductible on T shirts purchased with logo of my company on it?
If you are purchasing ready-made T-shirts with your company logo printed on them, it is treated as a purchase of goods. No TDS is required under Section 194C (TDS on contracts) or Section 194J (TDS on professional services). GST might apply, but TDS is not applicable under the Income Tax Act.
- If you are purchasing ready-made T-shirts with your company logo printed on them, it is treated as a purchase of goods.
- No TDS is required under Section 194C (TDS on contracts) or Section 194J (TDS on professional services).
- GST might apply, but TDS is not applicable under the Income Tax Act.
See lessWhether sports authority of India is considered as local authority?
No, SAI is not considered a local authority under the Income Tax Act. As per Section 10(20) of the Income Tax Act, a local authority includes:✅ Panchayats under Article 243(d) of the Constitution.✅ Municipalities under Article 243P.✅ Municipal Committees, District Boards, or similar authorities respRead more
No, SAI is not considered a local authority under the Income Tax Act.
As per Section 10(20) of the Income Tax Act, a local authority includes:
✅ Panchayats under Article 243(d) of the Constitution.
✅ Municipalities under Article 243P.
✅ Municipal Committees, District Boards, or similar authorities responsible for local governance and civic functions.
Hence, SAI is an Autonomous Body with No Local Governance Role and neither has any Statutory Authority for Local Self-Governance. It operates under the supervision of the Ministry of Youth Affairs & Sports, Government of India.
See lessDoes an invoice required to be signed? or we can mention that it is a computer generated invoice and not required to be signed?
Many businesses in India wonder whether an invoice must be signed or if a system-generated invoice is legally valid. Let’s break it down from both GST and Income Tax perspectives. 1. GST Rules on Invoice Signatures As per Rule 46 of the CGST Rules, 2017, an invoice must contain specific details suchRead more
Many businesses in India wonder whether an invoice must be signed or if a system-generated invoice is legally valid. Let’s break it down from both GST and Income Tax perspectives.
1. GST Rules on Invoice Signatures
As per Rule 46 of the CGST Rules, 2017, an invoice must contain specific details such as:
✅ Supplier’s Name & Address
✅ GSTIN
✅ Invoice Number & Date
✅ Description of Goods/Services
✅ Taxable Value & GST Amount
However, a physical signature is NOT mandatory if the invoice is issued electronically. Businesses can simply add a note stating:
📝 “This is a system-generated invoice and does not require a signature.” Here Computer generated means generated through a computer System/application.
What About E-Invoicing?
For businesses with a turnover of ₹5 crore or more (from 1st August 2023), e-invoicing is mandatory. These invoices are digitally signed by the Invoice Registration Portal (IRP), making a physical signature unnecessary.
2. Income Tax Perspective on Invoice Signatures
The Income Tax Act, 1961, does not prescribe any format for invoices, nor does it require a signature. However, invoices should contain necessary details to support expenses or revenue for tax assessments.
3. When Should You Sign an Invoice?
Although signatures are not mandatory, some situations may require them:
✔️ Export Transactions: Foreign clients may request a signed invoice.
✔️ Government Contracts: Some government departments require physical signatures.
✔️ Legal Disputes: A signed invoice can provide stronger evidentiary value.
Conclusion: What Should You Do?
For most businesses, a computer-generated invoice with a disclaimer is legally valid. If required, businesses can use digital signatures (DSC) or scanned signatures instead of manual signing.
👉 Recommended Disclaimer for Your Invoices:
📌 “This is a system-generated invoice and does not require a signature.”
This ensures compliance while keeping your invoicing process efficient.
See lessOn what value Labor cess shall be calculated?
As per Section 3(1) of the Act, labour cess is levied at 1% of the "cost of construction." Cost of Construction Includes (Rule 3 of the Cess Rules, 1998) ✅ Material Cost – Cost of raw materials used in construction✅ Labour Cost – Wages and salaries paid to workers✅ Hire Charges – Rent for machineryRead more
As per Section 3(1) of the Act, labour cess is levied at 1% of the “cost of construction.”
Cost of Construction Includes (Rule 3 of the Cess Rules, 1998)
✅ Material Cost – Cost of raw materials used in construction
✅ Labour Cost – Wages and salaries paid to workers
✅ Hire Charges – Rent for machinery and equipment
✅ Architectural & Design Fees – Payments to consultants, engineers, and designers
✅ Contractor’s Bills – Total contract value for civil work
Cost of Construction Excludes
❌ Land Cost – Purchase price or lease rent of land
❌ Compensation to Workers – Paid under the Workmen’s Compensation Act
❌ GST Component – Indirect taxes levied under GST
Labour Cess on Supply and Service Cost with GST
- Labour Cess is not levied on GST; it is calculated on the pre-tax cost of construction.
- If a construction contract includes both supply and services, the cess is applied to the total contract value before adding GST.
- Example Calculation:
- Supply Cost (Materials): ₹50,00,000
- Service Cost (Labour, Machinery, etc.): ₹30,00,000
- Total Cost (before GST): ₹80,00,000
- GST @ 18% (if applicable): ₹14,40,000
- Labour Cess @ 1% on ₹80,00,000 = ₹80,000
See lessWhen Labor cess is applicable?
The Building & Other Construction Workers’ Welfare Cess (BOCWW Cess) is a levy imposed on the construction costs incurred by employers for building and other construction activities. As per Section 2(1)(d) of the Building and Other Construction Workers (Regulation of Employment and Conditions ofRead more
The Building & Other Construction Workers’ Welfare Cess (BOCWW Cess) is a levy imposed on the construction costs incurred by employers for building and other construction activities.
As per Section 2(1)(d) of the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, read with Section 2(d) of the Building and Other Construction Workers’ Welfare Cess Act, 1996, the term “building or other construction work” has a broad scope. It includes activities such as construction, alteration, repairs, maintenance, and demolition related to various structures, including buildings, streets, roads, railways, airfields, irrigation systems, drainage works, flood control projects (including stormwater drainage), power generation and distribution, waterworks, oil and gas installations, electric lines, telecommunication networks, dams, canals, tunnels, bridges, pipelines, transmission towers, and cooling towers. The government may also specify additional construction works through notifications. However, it excludes any construction activities covered under the Factories Act, 1948, or the Mines Act, 1952.
The BOCWW Cess is imposed on the total construction cost incurred by employers. As per Sections 3(1) and 3(3) of the Building and Other Construction Workers’ Welfare Cess Act, 1996, along with Notification No. S.O. 2899 dated 26.09.1996, the cess is charged at 1% of the total construction cost.
See lessDo I have any liability as a share holder of a Private Limited Company?
Shareholders' liability is limited to their shareholding in the company. They are not personally responsible for the company's debts or actions beyond the unpaid amount, if any, on their shares. However, shareholders may face personal liability if they engage in fraudulent activities. In the case ofRead more
Shareholders’ liability is limited to their shareholding in the company. They are not personally responsible for the company’s debts or actions beyond the unpaid amount, if any, on their shares.
However, shareholders may face personal liability if they engage in fraudulent activities. In the case of companies with unlimited liability, shareholders can be held responsible up to the amount they agreed to contribute to the company’s assets in the event of winding up. Shareholders who also serve as directors may have additional legal responsibilities.
See lessIs TDS deducted on Transports? is there any exemption on it?
Yes, TDS is applicable to transporters under section 194c, with @1% for individuals/HUF and @2% for others. Yes, the exemption is also available to the transporter of goods. As per Section 194C(6) 0f the Income Tax Act, 1961 "No deduction shall be made from any sum credited or paid or likely to be cRead more
Yes, TDS is applicable to transporters under section 194c, with @1% for individuals/HUF and @2% for others.
Yes, the exemption is also available to the transporter of goods.
As per Section 194C(6) 0f the Income Tax Act, 1961 “No deduction shall be made from any sum credited or paid or likely to be credited or paid during the previous year to the account of a contractor during the course of business of plying, hiring or leasing goods carriages, [where such contractor owns ten or less goods carriages at any time during the previous year and furnishes a declaration to that effect along with] his Permanent Account Number, to the person paying or crediting such sum.”
A specimen of the Declaration by Transporter is attached herewith.
See lessIs RCM applicable on the fee paid to a foreign player playing in India?
Hi, I am breaking your question into multiple pieces to make it easier to understand. Payment to Nonresident Taxable Person (NRTP) Section 2(77) of CGST Act, 2017 says that a Non-Resident Taxable Person means "any person who occasionally undertakes transactions involving the supply of goods or serviRead more
Hi,
I am breaking your question into multiple pieces to make it easier to understand.
Payment to Nonresident Taxable Person (NRTP)
Section 2(77) of CGST Act, 2017 says that a Non-Resident Taxable Person means “any person who occasionally undertakes transactions involving the supply of goods or services, or both, whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India.”
Requirement of Registration in India
Section 24 of the CGST Act, 2017, required NRTP to register under GST law mandatorily five days before the commencement of the business irrespective of the minimum threshold turnover limit.
Applicability of RCM
Since NRTP requires the registration, he has to deposit tax in advance, equivalent to the estimated tax liability calculated on the value of taxable supply for the period for which the registration has been obtained.
Conclusion: GST should be paid under forward charge, not under reverse charge.
See lessHow to make payment of TDS on purchase of Property?
Here is the step-by-step process for making payment for TDS on immovable property. Go to the login page of the official Income Tax website (https://eportal.incometax.gov.in/iec/foservices/#/login?language-code=en) log in to your account Navigate to the "E-file" section and select 'e-pay Tax In the 'Read more
Here is the step-by-step process for making payment for TDS on immovable property.
6. Choose your preferred payment mode: ‘Pay later’ or ‘Pay Now’.
7. Click on ‘Pay Now’ to make payment of TDS
8. After payment, the Form 26QB acknowledgment will be generated and can be downloaded.
9. Login as a Taxpayer on the TRACES Portal (https://contents.tdscpc.gov.in/) and generate the TDS Certificate from
See less