18 June 2009
XYZ Pvt Ltd co., paying every month Building rent Rs. 30000/- and telephone charges, elct. charges & other expenses over all Rs.15000/- to ABC Pvt Ltd co. - then XYZ to be deducted TDS from ABC for rent 22.66% and in which rate TDS to be deducted on reimbursement exp.(as above mentioned expenses -which is not a maintenance or Hire charges)and also which under sec.(Nature of Payment)to be accounted
18 June 2009
I do not agree with the this proposition. In case if the reimbursement is being made against the actual bill then only the this proposition holds good. However from the language of the query it seems that the fixed charges are being paid for so called reimbursement of expenditure. Payment of a fixed charge for shall partake the character of rent in such case, accordingly a TDS @ 22.66% would be required to be deducted.
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