TDS & expenses Claim
This query is : Resolved
29 June 2010
My client have group companies XYZ & ABC
R company Ltd. is a consultant to our group and company is billing to ABC of Rs.20 lacs per year for concultancy provided to both the companies. on our mutual understanding XYZ & ABC companies are sharing 50% -50% of share of expneses and also booking expnes in thier accounts XYZ is booking on the basis of debit note from ABC company.
My query is that
1. either both tha compay is eligible to claim expenses 50%-50% even R Company limited is billing to ABC company.
2. TDs has been deducted by the ABC company.
3.how the XYZ compnay will be able to claim expeses.
R company Ltd. is a consultant to our group and company is billing to ABC of Rs.20 lacs per year for concultancy provided to both the companies. on our mutual understanding XYZ & ABC companies are sharing 50% -50% of share of expneses and also booking expnes in thier accounts XYZ is booking on the basis of debit note from ABC company.
My query is that
1. either both tha compay is eligible to claim expenses 50%-50% even R Company limited is billing to ABC company.
2. TDs has been deducted by the ABC company.
3.how the XYZ compnay will be able to claim expeses.
29 June 2010
Both the companies will be eliglible to claim equal expenses if an agreement has been made between both that expenses paid on behalf of XYZ will be paid by ABC i. e. a cross charge agreement will be entered between both of the companies.
While transferring the expenses TDS & service Tax provisions will be applicable.
While transferring the expenses TDS & service Tax provisions will be applicable.
29 June 2010
ABC LTD WILL BOOKED EXPENSE 100% IN ITS BOOKS AND DEDUCT TDS.
IF ABC LTD ARE ISSUING DEBIT NOTE FOR THESE EXPENSE, IT IS NOT VALID. ABC LTD HAS TO ISSUE INVOICE FOR IT BY CHARGING SERVICE TAX.
EXPENSE WILL BE BOOKED BY XYZ LTD BY CREDITING ABC LTD A/C AND TDS WILL BE DEDUCTED OF ABC LTD BY XYZ LTD.
IF ABC LTD ARE ISSUING DEBIT NOTE FOR THESE EXPENSE, IT IS NOT VALID. ABC LTD HAS TO ISSUE INVOICE FOR IT BY CHARGING SERVICE TAX.
EXPENSE WILL BE BOOKED BY XYZ LTD BY CREDITING ABC LTD A/C AND TDS WILL BE DEDUCTED OF ABC LTD BY XYZ LTD.
01 July 2010
Mr. Maheswari, Mr. Bansal
My Seniors are saying that XYZ comapany can claim expeses on the basis of debit note and without charge of service tax & TDS liability.
Pls. explain with certain good information.
Thanks
My Seniors are saying that XYZ comapany can claim expeses on the basis of debit note and without charge of service tax & TDS liability.
Pls. explain with certain good information.
Thanks
01 July 2010
At the end which company is booking the expenses? XYZ.
So it has to deduct TDS on the expenses which it is claiming. SO TDS is deductible.
So it has to deduct TDS on the expenses which it is claiming. SO TDS is deductible.
01 July 2010
XYZ LTD WILL BOOK EXPESNES ON THE BASIC OF DEBIT NOTE/ BILL OF ABC LTD.
HENCE XYZ WILL DEDUCT TDS ON IT.
HENCE XYZ WILL DEDUCT TDS ON IT.
01 July 2010
Controverial reply by Ramesh Krishnan on this link
https://www.caclubindia.com/experts/tds-421335.asp
So there is confusion.
https://www.caclubindia.com/experts/tds-421335.asp
So there is confusion.
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