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taxation law amendment act

10 May 2007

It is not clear from the amendment act whether TDS on the rent of equipment etc. will come into effect from 1st April, 2006 or not although the definition is changed with effect from 01.04.2006.

Earlier car with driver or heavy equipment with operator were subject to TDS as contractor but what will happen where car with driver or heavy equpment with operator is provided particularly when separate break-up of value is not given.

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1 Replies

Manjunath (37 Points)
Replied 10 May 2007

Dear  freind

NEW RENT PAYMENTS ATTRACTING TDS:

The following kinds of new rent payments (which were hitherto not attracting TDS) shall require deduction of TDS if paid or credited to payee on or after the date of assent (w.e.f.13.07.2006).

1. RENT FOR USE OF PLANT (whether owned by payee or not) and whether rented separately or together with other items mentioned in definition of ‘Rent’.

2. RENT FOR USE OF MACHINERY (whether owned by payee or not) and whether rented separately or together with other items mentioned in definition of ‘Rent’.

3. RENT FOR USE OF EQUIPMENT

4. RENT FOR USE OF FURNITURE AND/OR

5. FITTINGS

Hence. I request you to kindly deduct and deposit TDS @ 15.3% incase of  rent paid to  individuals or @ 22.44% in case of rent paid to a person other than an individual or HUF, u/s.194-I, w.e.f. 13.07.2006.

Further, in my opinion, car hire charges( car rental charges) will also cover under this,siince, the car is shown under the head PLANT &  MACHINERY  in  depreciation schedule under the ACT.

Thanks & Regards.

Manjunath