Tds on non refundable frencisee fees

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

19 August 2013 Whether TDS on lump sum non refundable frenchisee fee is required to be deduct or not..??

kindly give the reference.

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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19 August 2013 If the franchisee fee is non refundable then it is to be treated as income and TDS is to be deducted by the depositor and not you. If against the franchisee fee you have created any asset then this can be treated as capital receipt and accordingly no tax will be payable by you as the same is to be reduced from the cost of acquisition of the assets. If the fee is received only against the formula then it is revenue income asd is taxable in the year of receipt.

Querist : Anonymous

Querist : Anonymous (Querist)

07 December 2013 Thank you sir but how can we create an asset against its payment.

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