Section 194Q - TDS on purchase of goods (as amended by Finance Act 2025)

• Applicability

Any person whose total sales, gross receipt or turnover from the business exceed Rs. 10 crores in the preceding Financial year and who purchase any goods of value or aggregate of value exceeding Rs. 50 lakhs during the current Financial year.

• Rate of TDS

0.1% of sum exceeding Rs. 50 lakhs

• Example

The turnover of ABC Ltd. for the Financial year 2024-25 was Rs. 20 crore. It purchased the goods from XYZ Ltd. between the period of 1 April 2025 to 15 May 2025 of Rs. 70 lakhs then ABC Ltd. is required to deduct TDS on amount in excess of Rs. 50 lakhs. Hence TDS u/s 194Q will be 0.1% of Rs. 20 lakhs i.e. Rs. 2000.