TDS Under GST - Section 51 Complete Guide
Quick Summary
Government departments & specified entities deduct 2% TDS on payments > ₹2.5 lakh under Section 51.
What is TDS Under GST?
Section 51 requires certain entities to deduct 2% GST (1% CGST + 1% SGST or 2% IGST) from payments to suppliers.
Who Deducts TDS?
- Central Government departments
- State Government departments
- Local authorities
- Government agencies
- PSUs (as notified)
When to Deduct?
Threshold: Total contract value > ₹2.5 lakh
Rate: 2% (1% CGST + 1% SGST or 2% IGST)
On: Payment amount (excluding GST)
How It Works
Invoice: ₹1,00,000 + ₹18,000 GST = ₹1,18,000
TDS: 2% of ₹1,00,000 = ₹2,000
Payment: ₹1,18,000 - ₹2,000 = ₹1,16,000
Supplier claims: ₹2,000 TDS credit
Compliance
- Deduct TDS at time of payment
- Deposit to government by 10th next month
- File GSTR-7 monthly
- Issue TDS certificate (GSTR-7A)