Free gifts to dealers
This query is : Resolved
12 April 2012
FACTS
The company comes out with a scheme every year wherein the dealers of the company are awarded with some gifts (in kinds like gold chain, Europe trip, i-pad etc) upon some achievement of sales criteria as fixed by the company. The schemes are circulated to the dealers well before the period of the scheme. The said expenses are booked by the company under the head “Business Promotion Expenses”.
QUERY
Whether the company is liable to deduct TDS on the above gifts?
Whether these gifts are taxable in the hands of the dealer?
The company comes out with a scheme every year wherein the dealers of the company are awarded with some gifts (in kinds like gold chain, Europe trip, i-pad etc) upon some achievement of sales criteria as fixed by the company. The schemes are circulated to the dealers well before the period of the scheme. The said expenses are booked by the company under the head “Business Promotion Expenses”.
QUERY
Whether the company is liable to deduct TDS on the above gifts?
Whether these gifts are taxable in the hands of the dealer?
12 April 2012
These are allowable as business expenses.
a) i think the company need not deduct TDS on such expenses because it is like turnover Discount and no TDS prescribed on discounts. But i am not sure this my opinion only so wait for some other experts decision or suggestion.
b) No doubt these are taxable in the hands of dealer as discount received or Under the head income from other sources choice is their but the first option is appropriate to this case.
OM SAI SRI SAI JAI JAI SAI
a) i think the company need not deduct TDS on such expenses because it is like turnover Discount and no TDS prescribed on discounts. But i am not sure this my opinion only so wait for some other experts decision or suggestion.
b) No doubt these are taxable in the hands of dealer as discount received or Under the head income from other sources choice is their but the first option is appropriate to this case.
OM SAI SRI SAI JAI JAI SAI
12 April 2012
No. Gifts given to dealers are not subjected to TDS since they are not winnings from lotteries.
Yes. The gift received by the dealers are subjected to tax under B/P
Yes. The gift received by the dealers are subjected to tax under B/P
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- REGARDING GST ON COMMERICIAL PROPERTY
- Is this income indian or foreign income?
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- GST on export of services and Input Credit
- ITC temporary reversal and reclaim
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- TDS U/S. 194NF
- Applicable TDS rate for sale of property in Nov 2024
- Tds on building rent monthly
- Event company query
- MIS MATCH OF INVOICE NUMBER
- VERIFICATION OF REFUND RELATED
- GST Regis.
- ITC c/f from FY2022-23 to FY2023-24 entered the same in table 8C of GSTR9 of FY 2022-23, in FY23-24
- Late filling fees Demand by gst office
- IGST Credit-Show cause notice issued-confusion
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
Trending Online Classes
CAclubindia
