26 January 2013
A client has a contract with an advertising agency, the agency incurrs the expenditure and the same is reimbursed by the client. however the agency charges the commision which is shown in the invoice separately along with expenses to be reimbursed.
Please suggest that whether the commission amount will be subject to deduction U/S 194H or the whole billamount will be subject to deduction U/S 194C.
26 January 2013
IT IS PREFERABLE TO PREPARE TWO INVOICES IE., ONE FOR COMMISSION AND OTHER FOR REIMBURSEMENT OF EXPENSES. THAN TDS SHALL BE DEDUCTED U/S 194H FROM THE COMMISSION PART ONLY.
27 January 2013
if u cannot proof the reimbursement of expenses than tds is attracted on whole amount and the whole amount will be treated as your income.
whether the tds is deducted under 194c or 194H depends on the nature of contract.
CAclubindia
