Tax deduction at source
This query is : Resolved
19 July 2012
Company Will reimburse Travelling expense incurred by person to another Company. Whether TDS is to deducted or not? and deducted then What rate?
19 July 2012
In case of reimbursement there is no need to deduct TDS as it is neither for receiving any services nor for any contract. Provided the bills are provided by the claimant.
26 July 2025
Here's a quick clarification on your query:
* **If the company is reimbursing traveling expenses to a person (say, an employee or a vendor) on production of valid bills**, then **no TDS is required to be deducted** on the reimbursement amount.
* This is because reimbursement is a repayment of expenses and **not considered as income or payment for services**.
* However, if the reimbursement is paid without bills or as a fixed allowance without actual expenses, then it may be treated differently.
**So, as long as bills/receipts for travel expenses are submitted, TDS is NOT deducted.**
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* **If the company is reimbursing traveling expenses to a person (say, an employee or a vendor) on production of valid bills**, then **no TDS is required to be deducted** on the reimbursement amount.
* This is because reimbursement is a repayment of expenses and **not considered as income or payment for services**.
* However, if the reimbursement is paid without bills or as a fixed allowance without actual expenses, then it may be treated differently.
**So, as long as bills/receipts for travel expenses are submitted, TDS is NOT deducted.**
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