Hi - We are paying expenses on reimbursement to our Lawyers for the service rendered to us, however they have not provided any supporting document to us (Amount already agreed by us). While paying those amount, whether we need to deduct TDS or not ?
Regards
Shankar G
No TDS is required to be deducted on re-imbursement of expenses unless the same forms part of one consolidated bill for professional fees.
In order to avoid TDS on re-imb of expenses, take 2 separate bills from your lawyer : one for professional fees and other for out of pocket expenses. This bill for out of pocket expenses is sufficient enough for you to claim it as an expense. No need of any supporting documents / bills for the same
I appreciate the view.
But can we have a refrence from the Act (or please explain a bit more) that it will be OK not to deduct any TDS on Bills raised by a Lawyer (or Clearing and Forwarding Agents in the case of Imports) claiming out of pocket expenses.
CAclubindia
