|Tax Deduction at Source (TDS) under Section 51 of the CGST Act, 2017 read with Rule 66 of the CGST Rules, 2017
||Applicable Section/ Sub-section/ Notification
|Who is required to deduct TDS (deductor)?
||Section 51(1) r.w. Notification No. 50/2018 – Central Tax dated September 13, 2018
||Following persons are required to deduct TDS:
(a) a department or establishment of the Central Government or State Government; or
(b) local authority; or
(c) Governmental agencies; or
(d) such persons or category of persons as may be notified by the Government on the recommendations of the Council
Persons notified under Section 51(1)(d):
(a) an authority or a board or any other body, –
(i) set up by an Act of Parliament or a State Legislature; or
(ii) established by any Government,
with fifty-one per cent. or more participation by way of equity or control, to carry out any function;
(b) Society established by the Central Government or the State Government or a Local Authority under the Societies Registration Act, 1860 (21 of 1860);
(c) public sector undertakings
|When & from whom TDS is required to be deducted (deductee)?
||Suppliers of taxable goods or services or both to the deductor(s), where the total value of such supply, under a contract, exceeds INR 2,50,000/-
|Rate of TDS
||TDS is to be deducted at the rate of 1% [i.e. 2% for CGST+SGST/UTGST or IGST] from the payment made or credited to the deductee
|Value of supply
||Explanation to Section 51(1)
||For the purpose of TDS specified above, the value of supply shall be taken as the amount excluding CGST, CGST/UTGST, IGST and cess indicated in the invoice
|Compulsory registration for TDS deductor
||TDS deductors, whether or not separately registered, are required to compulsorily register in GST irrespective of threshold limits.
|Form for TDS deductor registration
||Form GST REG-07 – Registration started from September 18, 2017(The Goods and Services Tax (GST) Council, at its 21st meeting in Hyderabad)
TDS applicants who do not have a PAN, can register on basis of TAN
|Payment of TDS by deductor
||The amount of TDS shall be paid to the Government by the deductor within 10 days after the end of the month in which such deduction is made.
|TDS Certificate to deductee
||Section 51(2) and Section 51(3) r.w. Rule 66(3)
||The deductor shall furnish to the deductee a certificate in Form GSTR-7A (made electronically available), within 5 days of crediting the amount so deducted to Government, mentioning therein:
1. contract value,
2. rate of deduction,
3. amount deducted,
4. amount paid to the Government
5. Such other particulars in such manner as may be prescribed
|ITC to deductee
||The deductee shall claim credit, in his electronic cash ledger, of the tax deducted and reflected in the return of the deductor furnished under Section 39(3).
|GST Return by the TDS deductor
||GSTR-7 (The due date of filing GSTR-7 is due on 10th of the following month)
|Interest / Late fee for non-compliance
|Non-payment of TDS within time
||Interest as per Section 50(1) [at 18% per annum] is payable in addition to the amount of tax deducted.
|Failure to furnish TDS Certificate
||Late fee of INR 1,000/- per day from the day after the expiry of five days period until the failure is rectified, subject to a maximum amount of INR 5,000/-
[i.e. INR 2,000/- per day subject to maximum of INR 10,000/- for CGST + SGST/UTGST]
|Recovery & Refund
|Determination of amount in default
||In accordance with Section 73 (determination of tax in non-fraud cases) or Section 74 (determination of tax in fraud cases) of the CGST Act, 2017
|Refund of excess deduction
||Refund to deductee arising on account of excess or erroneous deduction shall be dealt in accordance with Section 54.
No refund shall be granted if the amount deducted has been credited to electronic cash ledger of deductee.