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Disallowance of expense on Non pay of TDS

Tejas shah (Sweeper) (163 Points)

28 September 2018

if loan is taken from NBFC's and i have been charged loan processing fees on that is TDS to be deducted on loan Processing fees????

if i do not deduct does it get disallowed under Income Tax Act???

kindly revert...

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12 Replies

Ruchika Somani (Coaching and Practice in Tax Audit Law.) (4429 Points)
Replied 28 September 2018

TDS is not deducted from interest to banks against loan

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Tejas shah (Sweeper) (163 Points)
Replied 28 September 2018

its an NBFC... And subject matter here is Loan Processing fees....

Ruchika Somani (Coaching and Practice in Tax Audit Law.) (4429 Points)
Replied 28 September 2018

No TDS deducted on Loan processing fees

(Guest)

As per Sec 194A if Interest (which includes Processing fees ) is paid to the banking company regulated by Banking Regulation act, it is exempt from TDS deduction ,but since the NBFCs are not governed by Banking Regulation Act, interest paid to NBFCs is subject to TDS deduction u/s 194A

2 Like

Tejas shah (Sweeper) (163 Points)
Replied 28 September 2018

@ RatAnu
TDS is paid on interest availed from NBFC.. subject matter is Loan processing fees

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(Guest)

read my reply carefull.. its included loan processing fees.. i hope u got the answer

Ruchika Somani (Coaching and Practice in Tax Audit Law.) (4429 Points)
Replied 28 September 2018

TDS wont be paid on processing fees

Tejas shah (Sweeper) (163 Points)
Replied 28 September 2018

@ Ruchika... RatAnu is Right...

Ruchika Somani (Coaching and Practice in Tax Audit Law.) (4429 Points)
Replied 28 September 2018

Processing fees is paid after loan is processed and not along with interest hence TDS is not attracted to processing fees

Tejas shah (Sweeper) (163 Points)
Replied 28 September 2018

@ Ruchika There is an article where tribunal has held that Banks loan processing no TDS as Banking regulation act applies...rest in NBFC it is req. to deduct TDS as Banking act not applicable....