Aashish Verma (Accounts Officer) (50 Points)
15 March 2014Dear All,
Our landlord has paid electricity bill of Rs. 3500/- on our behalf. Now we have to pay the same amount in his account. Please let me know whether we are liable to deduct TDS on the said amount or not ?
As per my view we should not deduct tax at source u/s 194I because we are not providing income (since it's not rent payment) to him.
Please discuss.
Thanks
SIVARAMAKRISHNAN P.G
(CA final student)
(129 Points)
Replied 15 March 2014
I think tax is required to be deducted on the total amount as the electricity bill is also a part of the rent.
Under Section 40(a)(i) & (ia) of the I.T Act, payments which are made without deducting tax are not allowed as deduction. In my view tax is required to be deducted on the total amount inorder to claim the rent amount as an allowable expenditure.
Lets see what others think about it..
Manoj Mehta
(Head Of Department (Accounts & Finance))
(1479 Points)
Replied 15 March 2014
Dear Sir
Yes you dont have to deduct tax on the same as this is not his income. Secondly the amount paid does not form a part of his rent income as per rent agreement made. it can be treated as reimburesement of expenses.
Regards
Analysis of 20 GST Notices (including 2 Appeals) and Practise on Drafting(with recording)
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