Tds

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

27 April 2016 A party having business of car hire, supplying cars to a firm.
Besides of the car business they have booked air ticket for the business tour of partner.
Bill raised in the partner's name.
The payments is done by firm.
The party crosses the target of Rs. 75000/- in the year.
The firm debiting all the expenses as"conveyance & travelling" and deducting TDS.regularly..
Is the firm liable to deduct TDS ON AIR TICKET OR NOT ?. if it no any notification is there ?
Please explain.

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

27 April 2016 assuming the person to be IATA member, TDS is NOT required to be done on the value of the air ticket.

CA SUNIL K GARG

CA SUNIL K GARG (Expert)
Follow

29 April 2016 As per Section 37 "Any expenditure (not being expenditure of the nature described in sections 30 to 36] and not being in the nature of capital expenditure or personal expenses of the assessee), laid out or expended wholly and exclusively for the purposes of the business or profession shall be allowed in computing the income chargeable under the head "Profits and gains of business or profession".
The payment is made for business tour, as partner is not having any personal interest hence the firm can claim deduction of air ticket and liable to deduct TDS u/s 194C on amount of bill.

Upgrade to CAclubindia Pro. Subscribe Now!