Under section 393(1) of the Income-tax Act, 2025, what is the rate of tax to be deducted at source on a…
Under section 393(1) of the Income-tax Act, 2025, Table: Sl. No. 6(i) (formerly s.194C of the 1961 Act), tax is deducted at 1% where the contractor is an individual or a…
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Under section 393(1) of the Income-tax Act, 2025, what is the rate of tax to be deducted at source on a sum paid to a resident contractor for carrying out any work in pursuance of a contract with a designated person, where the contractor is an individual?
Answer and explanation
Correct answer A
Under section 393(1) of the Income-tax Act, 2025, Table: Sl. No. 6(i) (formerly s.194C of the 1961 Act), tax is deducted at 1% where the contractor is an individual or a Hindu undivided family and at 2% where the contractor is any other person, the threshold being Rs. 30,000 for a single sum or Rs. 1,00,000 for the aggregate of such sums in a tax year. Hence 2% applies only to contractors other than individuals and Hindu undivided families, while 5% and 10% are not rates prescribed for payments to contractors.
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