Whether payment by a charitable trust which constitutes its application of income will attract tds?
To elaborate, a charitable trust enjoying exemption u/s 11 and having public health care as its object has made an arrangement with a medical professional to render medical service in rural areas. The arrangement is that the doctor engaged shall render free medical service in specified 2 locations, which will include dispensing free medicines. He will meet all expenses in the course which will be reimbursed to him by the trust on production of bills and he will be totally devoted to the trust without any independent practice of his own. Thus, the trust makes payment to the doctor on 2 counts – (1) salary to the doctor himself for the services rendered (2) reimbursement of actual expenses met by him in the course of such activity.
The question is whether the trust is to deduct tds on both the above payments - u/s 194J on the payment to the doctor’s remuneration (he is not an employee of the trust) and u/s 194C on all the reimbursements effected to the doctor (payment in both these cases exceeds the respective threshold limit???
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