sagar (CA Final) (379 Points)
06 July 2009Is TDS applicable if purchased a Fixed asset? According to me. as per provisions if you do not deduct TDS. The expenditure will be disallowed.
For purchasing a fixed asset we do not debit an expenses account. Hence No TDS to be deducted.
In Otherwords if you are Capitalising an expenses Then TDS is to be deducted.
I am confused whether its true or not
RITESH KOTHARI
(B.COM, FCA, DISA(ICAI))
(778 Points)
Replied 06 July 2009
it is absolutely correct.
on purchase of fixed asset thre is no TDS liability
sagar
(CA Final)
(379 Points)
Replied 06 July 2009
Thanks for confirming. Shall I take it as final answer
CA Devanshi Gandhi (Ajani)
(FCA DISA Mcom CIFRS & LLB)
(9060 Points)
Replied 06 July 2009
not applicable
Aditya Maheshwari
(CA in Practice)
(35867 Points)
Replied 06 July 2009
If labour charges on addition of furniture are seperately billed then TDS should be deducted for safety sake and to avoid any unnecesary litigation
Sagar
(Student)
(142 Points)
Replied 07 July 2009
Yes there is no liability of Tax Deducted on source on purchase of fixed assets.. When you pay Labour charges against fixed assets then you have to deduct TDS on that only if the limit is crossed.
Amit
(student)
(47 Points)
Replied 07 July 2009
yes no there is no TDS liability on purchase of fixed assets.
RAJU
(LEARNER)
(1089 Points)
Replied 07 July 2009
Hi sagar,
Tax is not deductible for purchase of any asset. However, if labour charges are paid for construction of building etc., TDS has to be deducted even if it is capitalised.
If I am not wrong, you are assuming a situation wherein payments on which tax is deductible is capitalised. In such an event, there is no question of additing back the expense, since expenditure is not claimed. However, this does not exempt you from deducting tax. You will always be liable to pay TDS irrespective of whether expenditure is claimed or not.
LAXMIKANT JAIPURKAR
(Practicing Company Secretary/Tax Consultant)
(403 Points)
Replied 07 July 2009
On various items which are added in the fixed assets, tds is required to be deducted i.e. pure labour contracts given for the construction of building (material supplied by the owner), amount paid to carpenter for the furniture works, installation of machinery, air conditioners, commission paid for the purchase of machinery, etc.
Ms.Monika
(Partner)
(22 Points)
Replied 08 July 2009
| Originally posted by :sagar | ||
| " | Is TDS applicable if purchased a Fixed asset? According to me. as per provisions if you do not deduct TDS. The expenditure will be disallowed. For purchasing a fixed asset we do not debit an expenses account. Hence No TDS to be deducted. In Otherwords if you are Capitalising an expenses Then TDS is to be deducted. I am confused whether its true or not |
" |
komal nemani
(CA Final CS Executive Student)
(141 Points)
Replied 11 September 2009
der is no TDS liability on purchase of fixed assets
Mayank kharbanda
(Risk Advisory Services)
(409 Points)
Replied 11 September 2009
Juzer Sadikot
(CA - innovative solutions for Imports and Exports)
(1309 Points)
Replied 11 September 2009
Dear Members,
The tax is to be deducted in case of any payment/credit specified under chapter XVII B of IT Act irrespective whether it is capitalised or treated as revenue.
If any person responsible for paying (section 204) does not deduct tax at source as specified under chapter XVII-B, the person responsible for paying shall be attracted penalty under section
Thanks
CAclubindia
