Tds on electricty

Page no : 2

Dadagonda Patil (1 Points)
Replied 07 September 2016

Landlord can not sale electricity to tenant. We can reimburse or pay direclty to electricity board.

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CA Harshal Totla (Chartered Accountant) (2229 Points)
Replied 07 September 2016

as per CBDT Circular No.715, dated 8.8.1995 it was clearly given that if re-imbursement of expenses are also included in gross amount of bill tds to be deducted where as if seperate bill raised for re-imbursement of expenses tds not applicable but in general to apply tds, In order to address the issue whether tax is required to be deducted at source, in respect of reimbursement of expenses, it will be necessary to keep in mind the following two aspects, viz : (i) Tax is deductible at source under Chapter XVII-B of the Act, only in respect of payment of income or other sum made by the person responsible for such payment, viz. tax-deductor to other person being the tax-deductee, and (ii) Reimbursement of expenses does not partake the nature of income in the hands of the payee of such expenses it may be any sum but we cannot deduct tds on re-imbursement expences as it is not partake income in the hands of person as explianned above provided they have to give separate bill for re-imbursement of expenses.