Businesses and professionals often face liquidity issues when excessive TDS is deducted from their payments. To resolve this, the Income Tax Act provides relief through the Lower Deduction Certificate (LDC) under Section 197.

At KK Reddy & Associates, Nanakramguda, we assist clients in obtaining timely and accurate LDCs to reduce the burden of unnecessary tax deductions and improve cash flow.

What is a Lower Deduction Certificate (LDC)?

An LDC is a certificate issued by the Income Tax Department, allowing the payer to deduct TDS at a lower rate or a nil rate, based on the applicant’s projected income and tax liability.

✅ Applicable for:

– Contractors and professionals

– Exporters or businesses with low profit margins

– Entities receiving interest, rent, commission, etc.

✅ Common sections:

– 194C, 194J, 194I, 194H, 195 (for non-residents)

When and Why You Should Apply

You should apply when:

– You expect your total tax liability to be lower than standard TDS deductions

– You have prior tax refunds due to over-deductions

– You want to improve cash flow and avoid refund delays

This is especially important for businesses in seasonal industries or with advance income.

How to Apply for LDC

1. File Form 13 online via the TRACES/Income Tax portal

2. Submit supporting documents including:

– PAN, previous returns, financials, projected income

– Details of income streams subject to TDS

3. Income Tax Officer reviews the application and issues certificate digitally

KK Reddy & Associates ensures that your application is correctly filed with proper projections, minimizing the risk of rejection.

Benefits of Obtaining an LDC

– Prevents excessive TDS deduction

– Ensures better cash flow and liquidity

– Avoids delays in claiming refunds

– Reduces administrative effort in reconciliation and return filing

– Improves vendor and client trust

Our LDC Services at KK Reddy & Associates

✅ Assessment of eligibility for LDC

✅Preparation and filing of Form 13 with projections

✅ Assistance in gathering necessary documents

✅ Liaising with the tax department for follow-up or queries

✅ Compliance guidance post-certificate issuance

We assist individuals, private limited companies, LLPs, and NRIs in securing LDCs under various sections.

Contact Us Today

Ensure smoother cash flows by avoiding over-dedication of TDS.

📍 Address: Flat No. 208, Opp to Golf View Apartments, Nanakramguda, Hyderabad

📧 Email: info@kkreddyassociates.com

☎️ Call: +91-9989107350

🌐 Website: https://www.kkreddyassociates.com/Lower-Deduction-Certificate-Hyderabad