Guidelines under section 194Q of the Income-tax Act, 1961

Income tax vide Circular No. 75/2021 dated 25th June, 2021 has Issued guidelines under Section 194Q of the Income Tax Act, 1961.
i. Finance Act, 2021 inserted a new section 194Q in the Income-tax Act 1961 which takes effect from 1st July, 2021. It applies to any buyer who is responsible for paying any sum to any resident seller for purchase of any goods of the value or aggregate of value exceeding fifty lakh rupees in any previous year.
ii. The buyer, at the time of credit of such sum to the account of the seller or at the time of payment, whichever is earlier, is required to deduct an amount equal to 0.1 % of such sum exceeding fifty lakh rupees as income tax.
iii. Buyer is defined to be person whose total sales or gross receipts or turnover from the business carried on by him exceed ten crore rupees during the financial year immediately preceding the financial year in which the purchase of good is carried out.