TDS experts come n helppp....... m Waiting :)

Dear Rashmi,

TDS will be deducted as per Sec 192 because "any fees " also falls within the meaning of salary...

Sec 17 defines Salary as follows -

For the purposes of sections 15 and 16 and of this section,

 (1)  “salary” includes—

       (i)  wages;

      (ii)  any annuity or pension;

     (iii)  any gratuity;

     (iv)  any fees, commissions, perquisites or profits in lieu of or in addition to any salary or wages;

      (v)  any advance of salary;

[(va)  any payment received by an employee in respect of any period of leave not availed of by him;]

     (vi)  the annual accretion to the balance at the credit of an employee participating in a recognised provident fund, to the extent to which it is chargeable to tax under rule 6 of Part A of the Fourth Schedule;

    (vii)  the aggregate of all sums that are comprised in the transferred balance as referred to in sub-rule (2) of rule 11 of Part A of the Fourth Schedule of an employee participating in a recognised provident fund, to the extent to which it is chargeable to tax under sub-rule (4) thereof; and

[(viii) the contribution made by the Central Government [or any other employer] in the previous year, to the account of an employee under a pension scheme referred to in section 80CCD;]

Dear Rashmi,

Tell me whether this is correct or not....

Suppose an employer takes his employee's premises on rent (say it exceeds Rs. 1,20,000) then I think TDS will be deducted u/s 194 I @ 10%..Because rent doesnot  fall in the definition of Salary...

Incase, Rent doesnot exceed 1,20,000 then TDS can be deducted u/s 192(2B), if employee wishes so & makes a declaration for deduction of Tax..

Hi rashmi,

agree with amir bhai above, but u could also apply some simple test like

whether the special service rendered, comes within the scope of his employment or is closely related to it? If yes, it can b treated as salary itself...

If an employee does the work of a professional also, salary will be the section under which TDS should be made.... for eg, if a CA works in a company and provides them the legal compliance with his knowledge, TDS is u/s 192, not 194J.....

Further, professional fees should be as per the defintion in 194J.... see if there is a professional service within the meaning of that section...

All payments made by payer to payee is considered as salary, where there subsists a relation of employer and employee between the two.

Hence Sec 192 applies.

regards

 Sahana Murthy

Yes. What I think is that it depends on the circumstances of case. Determine, is payment is salary or professional fees. As Sahana say "Employer-Employee relationship". This is important. If it is in the nature of salary, then TDS is to be deducted u/s 192. If it is a profeessional feesthen TDS is to be deducted u/s 194J. Proffessional services include accounting, engineering, architectural etc. Just like payment to a Company Auditor is not salary, but it is proffessional fees. So, TDS would be deducted u/s 194J in such case.

You have to look in that whats the nature of payment and then decide.

Guyyyyyyyyyyysssssssss THANKS a TON....................Ur suggestions were really enlightening................Thanksss for the help :) ;) :)