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TDS on interest

A G Vishal Kirthic (Chartered Accoutant) (236 Points)

20 October 2011

Hi friends,

One of my clients have borrowed loan from LIC Housing Finance Ltd. It has been remitting TDS without deducting Interest. Is my client's act right?

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6 Replies

C.A SHASHANK GOYAL (Chartered Accountant) (362 Points)
Replied 20 October 2011

Hi , I think He is right in his action of not deducting Tds on interest being paid to Lic housing finance ltd as it is one of the banking and finance company in india and section 194a does not apply to the banking companies and financial corporations .

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Phalgun (Audit Manager) (327 Points)
Replied 20 October 2011

The query should have been remitting interest without deducting TDS.

Situation : Borrowal of loan

Payment : Interest other than interest on securities

Relevant section 194A

study the provisions of 194 A. In your case, tds not to be deducted as per 194a banks covered under Banking Regulation Act 1949 is not covered.

valji (Accounts manager-MBA) (2150 Points)
Replied 20 October 2011

agree with mr shashank

* Krishna * (CA Student) (6149 Points)
Replied 20 October 2011

Originally posted by : Phalgun
	The query should have been remitting interest without deducting TDS. Situation : Borrowal of loan Payment : Interest other than interest on securities Relevant section 194A study the provisions of 194 A. In your case, tds not to be deducted as per 194a banks covered under Banking Regulation Act 1949 is not covered.