16 June 2012
It is very important to see the terms of appointment of directors. If the amount is paid to non executive directors then all type of payment is deductible u/s 194J since he is not in the employement with the company. A non executive direcors may receive commission, remunearation, Sitting Fees as per the terms of Appointment as non executive directors. On other hand, An executive directors get salary from the Company and he is not entitlted for sitting Fees.All the payments as per his terms of employement is part of salary and TDS is deducted u/s 192.
23 June 2012
It is proposed to amend section 194J to provide that tax is required to be deducted on the remuneration paid to a director, which is not in the nature of salary, at the rate of 10% of such remuneration. The above change will be in case of non executive directors remunerations i.e. not in the nature of Salary.
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