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TDS On Reimbursement of Electricity Bill

suresh (M-F&A) (69 Points)

30 May 2008

Our Company has taken office on Rent, Beside Rent we are paying Electricity charges to landlord (i.e. Company) as per their own Invoice raised by them for Electricity used by us and also they charges Service Tax on that, so i think this is not actual reimb.of expenses (electricty). So TDS to be deducted on it or not ? if deducted under which section and what percentage ?. Please respond.

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22 Replies

Azmathullah Khan (Accounts Manager) (1386 Points)
Replied 30 May 2008

Mr. Suresh

Good question, even I am confuse, later I verified ur queries

If the landlord is issuing u the seperate bill then no need to deducted the TDS, but u have to demand the photocopy of the bills.

If he is adding the bill to the rent, then u have to deducted the TDS on total amount.

The rate of tds for Rent is 15% plus Surcharge 10% if the amount is exceed the limit and Ed is 3% for Individual

The rate of tds for Rent is 20% plus Surcharge 10% if the amount is exceed the limit and Ed is 3% for Company

1 Like

CA Akshat (article) (422 Points)
Replied 30 May 2008

i think u must pay the bill seperately and ask him not to add in rent

u can avoid TDS as afterall electricity bill is payment to govt.

suresh (M-F&A) (69 Points)
Replied 30 May 2008

I think my question is not cleared, I explained it further to seek answer - Landloard charge separately electrcity bill and not including in rent bill, and raise bill of electricity charges only but he charge per unit say Rs.8/- flat not as per govt.charge. Now in this case i think TDS applicable u/s 194J, since it is service rendered case. Please repond.Thanks.

Azmathullah Khan (Accounts Manager) (1386 Points)
Replied 31 May 2008

No TDS on electricity Bill, as ur sharing the bill with the landlord., I clearly mention u in my previous answer If the landlord is issuing u the seperate bill then no need to deducted the TDS, but u have to demand the photocopy of the bills to be attached with Voucher.

(Guest)

our compnay is paying rent to landlord. what is the rate o tds

Azmathullah Khan (Accounts Manager) (1386 Points)
Replied 16 June 2008

Ms Asha

TDS on rent for Individual 15%, For Company 20%

Add 3% Ed. Cess

If the amount of Rent is above 10L for Individual & 1 crore for company then add S. charges 10%

Attached for Details

Attached File : 32 form 16 16a.xls downloaded: 456 times

(Guest)

We as landlords raise rent inovice and debit note for electricity reimbursement as per clients actual consumption separately. The tenant is insisting to deduct tds on the electricity amount. As per him, any payment made under leave & license agreement is liable for tax deduction u/s 194 i. Although we are raising separate debit note to the tenant as per his actual consumption and also attach a copy of the Energy Bill.

I just read your comment, which sounds very convincing. But could you provide me proper reference in the IT Act or particular section which throws light on this issue of deducting tds from electricity reimbursement.

(Guest)

Originally posted by :Guest
"	We as landlords raise rent inovice and debit note for electricity reimbursement as per clients actual consumption separately. The tenant is insisting to deduct tds on the electricity amount. As per him, any payment made under leave & license agreement is liable for tax deduction u/s 194 i. Although we are raising separate debit note to the tenant as per his actual consumption and also attach a copy of the Energy Bill. I just read your comment, which sounds very convincing. But could you provide me proper reference in the IT Act or particular section which throws light on this issue of deducting tds from electricity reimbursement.	"

(Guest)

Please confirm whether the TDS is applicable on electricity bill raised by landlord on actual consumption basis. As lanlord make the consolidate payment for whole building and raise the invoices to tenants as per floor wise actual consumption.

Azmathullah Khan (Accounts Manager) (1386 Points)
Replied 21 October 2008

Mr. Rajanikant

The Electricity bill has to be added to rent account & deduct the TDS.

Harpreet (* * * * * *) (1670 Points)
Replied 30 December 2008

If the tenant has deducted Tds on electricity bill which generateed by the landlort and deducted as contractor on some bill, then tds should be deducted on rest bills or not.

Shudhanshu Agrawal (Business) (2570 Points)
Replied 30 December 2008

In this Case TDS willbe applicable under Section 194C as it willbe treated as contract and the amount on which TDS willbe calculated will include service tax as well.

TRILOCHAN (SENIOR ACCOUNTANT) (698 Points)
Replied 30 December 2008

dear i agree with the reply of mr. A khan

R.Suresh (Sr. Executive) (394 Points)
Replied 30 December 2008

Hi,

Your landlord reaising the bill for actual consumption and the rate would be charged as per EB means no tds should be deduct, and you get a copy of EB card xerox for your consumption and each payment. (No different between your payment or Landlord payment becuase paid only collect from you).
In other case landlord charging more and also charging the services tax for that means you have to go by IT act that is deduct TDS from the bill amount and pay.

Why i am telling this case means in 1st case no profit or gain (it is not at all Business) in 2nd case they have sum gain in this bill so that only.