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40(a)

RAMA KRISHNA (Sr.Executive - Accts & Preparing for IPCC) (670 Points)

27 August 2009

My query is we are a ltd., company. We are paying an amount of Rs.12,500/- as rent per month to our godown owner. During the year 2008-09 we paid an amount of Rs.1,50,000/- as rent to the godown owner. By oversight we are not deducted TDS till Feb'09.

we deducted TDS on 01.03.09 @ 15.45% on the total amount of Rs.1,50,000/- and deposited the same to govt. a/c on 26.05.09 with out interest.

Is the expenditure of Rs.1,50,000/- is eligible in 08-09 Financial Year ?

Hear 40 (a) is applicable ?

An early reply is higly appriciated in this regard.

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1 Replies

Aditya Maheshwari (CA in Practice) (35867 Points)
Replied 27 August 2009

TDS deductible in the month of March 2009 and paid before the due date of filing of return is not disallowed u/s 40(a)(ia). However if TDS deductible in months before March and deducted in March and paid after 31st March, 2009 will be allowed in F. Y. 2009 - 10 or the year in which payment is made.

So in your case since TDS was not deducted for the whole year and deducted in march only and paid in May Rs. 137,500/- (12500 * 11) will be disallowed u/s 40(a)(ia) and will be allowed in F. Y. 2009 - 10 and march rent will be allowed in the same F. Y. only.