12 June 2009
To my understanding, TDS on contract of erection services has to be deducted on the bill value.
In case, boarding and lodging expenses incurred by them and included in the bill value along with service charges,we need to deduct Tax only on service charges portion since boarding and lodging expeses are mere reimbursement.
If so, do we need get the proof of boaarding and to and fro bills for records??
13 June 2009
Tax is to be deducted on "Any Sum Paid". So, tax would be deducted even on lodging and boarding expenses even if they are mentioned separately in a bill.
I do not agree to your statement.The basic theme of TDS is to enhance the tax collection on all the "income generated" and to improve the coverage of assessees.But in our case, it is merely a reimbursement.It is not logical to charge tax on his expenses if it is separately given in the invoice.Any contrary to this, Pl advice.