Section 194C Engine

TDS on Contractor (Section 194C) Calculator

Compute TDS withholding on works contracts, advertising, transport, catering, and sub-contractors with PAN validation and statutory thresholds.

Payee & Invoice Breakdown

Payee (Contractor) Legal Status

Contractor PAN Furnished?

Current Single Invoice Value (₹)

₹

Cumulative Invoices in FY (₹)

₹

Section 194C Dual Threshold Rule

TDS is applicable only if a single invoice exceeds ₹30,000 OR the aggregate payment to the contractor in the financial year exceeds ₹1,00,000.

TDS Summary Rate: 1.00%

TDS Applicability Status TDS Applicable

TDS Amount to Deduct ₹450

Net Payment to Contractor Invoice Amount - TDS

₹44,550

Deduct TDS at the time of credit to contractor account or payment, whichever is earlier.

Section 194C TDS on Payments to Contractors & Sub-Contractors

Section 194C mandates any person responsible for paying any sum to a resident contractor for carrying out any work (including supply of labor for carrying out any work) in pursuance of a contract to deduct tax at source.

Definition of "Work" Under Section 194C

Advertising contracts (print, television, digital).
Broadcasting and telecasting including production of programs.
Carriage of goods or passengers by any mode of transport (other than railways).
Catering services.
Manufacturing or supplying a product according to customer specifications using material supplied by customer (Job work / Contract manufacturing).

Transporter Exemption (Section 194C(6))

No TDS is deductible on payments made to a contractor engaged in the business of plying, hiring, or leasing goods carriages, provided the transporter owns 10 or fewer goods carriages at any time during the financial year and furnishes a valid declaration along with PAN.

Section 194C Rate Structure

Payee Nature	TDS Rate (With PAN)	Without PAN (Sec 206AA)
Individual / HUF Contractor	1%	20%
Company / Firm / LLP / AOP	2%	20%
Transporter (≤ 10 vehicles + PAN)	0% (Nil TDS)	20%

Frequently Asked Questions

Is TDS deducted on the GST component of a contractor invoice?

No. As per CBDT Circular No. 23/2017, if the GST component (CGST, SGST, IGST) is separately indicated on the invoice, TDS must be deducted only on the basic value excluding GST.

What is the consequence of non-deduction of TDS under Section 194C?

Under Section 40(a)(ia), 30% of the expenditure paid to the resident contractor will be disallowed as a business deduction in that financial year.

What is the due date to deposit Section 194C TDS?

TDS must be deposited on or before the 7th of the next month (or April 30th for the month of March) using Challan ITNS 281.