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Section 194O of Income Tax Act - TDS on Payments Made to E-commerce

What is Section 194O of the Income Tax Act?

Who are E-commerce Operators and Participants?

What is the Purpose of Section 194O?

Section 194O TDS Rate Calculation

For Example:

Say you are a registered seller (e-commerce participant) on Flipkart (e-commerce operator). Your gross sales in a financial year = ₹5,20,000 (18% GST included). According to Section 194O, Flipkart should deduct a TDS of 0.1% from your gross sales.

The calculation is as follows:

Particulars Amount
Gross sale  ₹ 5,20,000 (18% GST included) 
Applicable TDS from the gross sales  0.1% 
TDS rate (0.1% of ₹5,20,000)  ₹520 

The amount should be deducted at the time of credit fulfilment and Flipkart should file a TDS return via Form 26Q and issue TDS Form 16A to you.

What is the Scope of Section 194O?

FAQs about Section 194O of Income Tax Act