TDS on unsecured loan fees
Sajid Khan (66 Points)
12 November 2021
what tds to be deducted on loan fees invoice from any private financial institutions
3 Replies
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177896 Points)
Replied 12 November 2021
In accordance with the Section 2 (28A) of Income Tax Act, 1961 Interest means interest payable in any manner in respect of any money borrowed or debt incurred (including a deposit, claims or other similar rights or obligation) and includes any service fee or other charge in respect of the money borrowed or debt incurred or in respect of any credit facility which has not been utilized.
As per Sec 194A if Interest (which includes Processing fees ) is paid to the banking company regulated by Banking Regulation act, it is exempt from TDS deduction.
But since the NBFCs are not governed by Banking Regulation Act, interest paid to NBFCs is subject to TDS deduction u/s 194A
CA Aakarsh Jain
(CA)
(10431 Points)
Replied 12 November 2021
TDS will be deducted @ 10% under section 194(A)
Recent Topics
- NRO Interest - Taxed at source and in Foreign Coun
- Clarity needed on effective date
- Income Tax Refund Deadline Shortened to Five Years
- Rectification Applications for Past GST Demands
- Where can I find a trusted provider to hire a skip
- GST Invoices Series
- FILING OF ITR AY 20-21
- CLAIMING OF U CLAIMED RCM
- Building construction works
- REGARDING GSTR-9 F.Y 2023-24
Related Threads
CAclubindia
