TDS deductibility

TDS 1099 views 7 replies

A professional submits two bills to his client exceeding Rs.30000/- each. One bill for his professional fees & out of pocket expenses, other bill for the reimbursement of professional fees paid by him to other consultants on behalf of his client.

Please advice applicability of TDS u/s 194J on these two seperate bills.

Thanks

Shankar Banerjee

Replies (7)

please clarify the question,  you wrote in the question that first bill is of professional fees & out of pocket expenses, what its mean

according to me your question is that

first bill of professional charges of Rs.30000/-

and second bill of reimbursment of Rs.30000/-

if i think right in that case tds is applicable on first bill at the rate of 10%, and not on the second bill because as per the concept of TDS, TDS is deducted on the income of payee and in your case, second bill is a reimbursment of expense which is not a income.

 

if it is wrong then please tell me

AMIT KUMAR

 

 

if the first bill is of Professional fees and Reimbursement of expenses then tds will be deducted on the part of Professional fees only. And for the second bill it is the matter of agreement between consultant and the professional that wether the professional  will deduct tds from the consultants bill.  but the client will have to deduct on the bill raised by the professional.  And then after the professional passes in the tds charge on the consultant it is his concern. 

agreed with friends.

 

regards,

 

manoj

agreed with Mr. Brijesh  &  Amit. Good job frnds.

Deduct TDS on the ENTIRE amount - i.e., Rs.60,000/-.

Friends, some things should be seen practically.

What if tomo, the AO disallows the amount under 40(a)(ia), you need to go on appeal. The Tax effect will be 10000, then you need to go on appeal and sorts. So why complicate the issue.

 

Deduct on the entire bill and relax, let him take credit. The money isn't lost forever is it??

 

Shiva

 

In case of the Reimbursment of expnese the bill is annexed by proper supporting  and also no Service Tax is levied on the bill like proof of travel, or other expenses, In that case the TDS is not to be deducted and also the expese is to be booked under the out of pocket expenses - Charges and in other case of fees TDs is to be deducted

I agreed......


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