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Urgent regarding Property Acq.

21 November 2020

if lawyer provides services regarding ownership change in case of building and charges Rs.50000, then whether TDS is applicable because we capitalise that expense, because total expenses incurres are Rs. 6lac including stamp duty

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6 Replies

JATINDER KUMAR (Accountant) (3662 Points)
Replied 21 November 2020

Yes

TDS is applicable u/s 194J on Rs. 50000

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Anmol Singla (808 Points)
Replied 21 November 2020

Even if we capitalise whole exp.?

JATINDER KUMAR (Accountant) (3662 Points)
Replied 21 November 2020

Yes, Anmol Ji

Shivam RC (Student) (23683 Points)
Replied 21 November 2020

Yes TDS U/s 194J of the Income Tax Act 1961 @ 10% will be applicable on Legal Services since the amount exceeds Rs. 30,000.

CA PARTH SHAH (In Practice) (1951 Points)
Replied 22 November 2020

If TDS is not deducted on Rs 50,000 of Legal fees what will be the consequenses ? Whether Depreciation on Capitalised Legal fees will be allowed?

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Anmol Singla (808 Points)
Replied 23 November 2020

Sir, I am in favour of point that we can capitalise even lawyer fees also as it is incurred for ownership change. but some experts are saying that you cannot capitalise lawyer fees. It leads to contradictory treatment. what can I do?