TDS deduction on ocean freight

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This query is : Resolved

Ravi Jagetiya(CA Final) (Querist)

14 November 2009 is there any liability to deduct TDS on ocean freight which was paid by C&F. He includes ocean freight in his invoice.

Ram Avtar Singh

Ram Avtar Singh (Expert)

15 November 2009 No TDS on Foreign shipping Co. & his authorized agent.

Ravi Jagetiya(CA Final)

Ravi Jagetiya(CA Final) (Querist)

15 November 2009 My client reimburses ocean freight to C& F, who ultimately pays it to indian shipping line, So in this case TDS should be deducted by my client ????

Ram Avtar Singh

Ram Avtar Singh (Expert)

15 November 2009 if your are paying to Indian company then TDS applicable on that reimbursment.under sec 194C.

Ravi Jagetiya(CA Final)

Ravi Jagetiya(CA Final) (Querist)

15 November 2009 Now as a matter of fact i would like to know that whether TDS is applicable on reimbursement also.
Let us take an example:
C& F charges is to the tune of Rs. 1000.
Expenses reimbursed by my client to him includin g of ocean freight is amounting to Rs. 500000.00.
Hence for the totla bill charged by C&F is for Rs. 501000.
So should my client deduct TDS on 500000 also which is not part of
C&F income.. Please through shed on the issue of TDS on reimbursement.

Thanks

CA SHIV SHANKAR KHUDANIA

CA SHIV SHANKAR KHUDANIA (Expert)

16 November 2009 In your case No TDS Liability on Rs. 1000/- since this relates to reimbursement of expenses and your client is acting as a agent on behalf of third party. one thing which you need to do is, get a invoive from C& F agent which mention the reimbursement seperately.

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