When does tds have to be deducted on interest amount ?

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Jignesh Desai

Jignesh Desai (Querist)
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23 July 2012 Under what circumstances does TDS have to be deducted from Interest paid\accrued on Loan taken ?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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23 July 2012 TDS need to be deducted on accrual(Credit) or Payment which ever is earlier

SANYAM ARORA

SANYAM ARORA (Expert)
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24 July 2012 Agreed to Ramesh Sir

Regards

Sanyam Arora

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Jignesh Desai

Jignesh Desai (Querist)
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25 July 2012 What I mean is - WHAT SHOULD BE THE STATUS OF THE 2 ENTITIES ? For e.g. , if both - the Loan Giver as well as Loan receiver are Individuals , in that case , would TDS have to be deducted from the Interest Amount ?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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25 July 2012 No. individual case, not required unless they payer covered under sec.44AB

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Jignesh Desai

Jignesh Desai (Querist)
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25 July 2012 If a Pvt. Ltd Company or a Business Firm (Proprietorship or Parnership) lends money as Loan to an Individual , then would the Individual have to deduct TDS from the Interest amount that he pays to the Firm/Company ?

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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25 July 2012 No as a Individual, no need to deduct TDS on Interest payment to others.

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