;NSURE tax deduction from payments to contractors and sub-contractors THE INCOME TAX LAW REQUIRES • Deduction of income-tax @ 2% from any payment made to a contractor for ^/vork done under a contract of more than Rs. 5,000 in value with the Central Government or any State Government my lodal authority, any corporation established under a taw, any company or any co-operative society B Deduction of income-tax @ 1 % from iny payment made to a sub-contractor (or work done under a sub-contract of more than Rs 5.000 in value with a contractor who is not an individual or a Hindu undivided family • Deduction of income-tax as above at the time of payment whether by credit to the account of the Contractor/ sub-contractor, or In cash or by cheque/draft whichever is earlier • Deposit of the income-tax deducted as above to the credit of the Centra Government in full and within the tim< as prescribed in the Income-tax Ruk^ FAILURE TO COMPLY WITH THE STATUTORY OBLIGATION f. j TO DEDUCT & DEPOSIT THE TAX HgiffULARLY ATTRACTS | PENAL CONSEQUENCES. | Issued by: DIRECTOR OF INSPECTION (Research, Statistics & Publication) INCOME-TAX DEPARTMENT New Delhi 110001