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Tds for interest paid

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(Querist)
20 May 2014 An individual A has paid interest for an amount of Rs.8,04,000/- on unsecured loan to an individual B. My Query is whether the individual A is required to deduct TDS @ 10% under section 194A. The provisions of tax audit is applicable or not?
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Sandeep Dharar

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Sandeep Dharar (Expert)
20 May 2014 Individual & HUF can't deduct TDS u/s 194A.
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Nikhil Kaushik

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Nikhil Kaushik (Expert)
20 May 2014 on account of first proviso to 194A an individual shall be required to deducted TDS if he/she is covered under tax audit under section 44AB.
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Tara Khandelwal

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Tara Khandelwal (Querist)
20 May 2014 @ Nikhik Kaushik
Sir,
The provisions of section 44AB should be with regard to the current financial year or preceding financial year?

Also if the individual is not covered under 44AB he need not deduct TDS even if the interest paid is more than Rs.5000/- Am I correct sir?
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Nikhil Kaushik

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Nikhil Kaushik (Expert)
20 May 2014 Dear Tara,

provisions of 44AB should be looked in from the perspective of preceding financial year.

if the individual or HUF is not covered under 44AB, TDS is not be deducted irrespective of the amount of interest paid.
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Tara Khandelwal

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Tara Khandelwal (Querist)
20 May 2014 Thank you sir for your clarification
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Nikhil Kaushik

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Nikhil Kaushik (Expert)
20 May 2014 Dear Tara,

provisions of 44AB should be looked in from the perspective of preceding financial year.

if the individual or HUF is not covered under 44AB, TDS is not be deducted irrespective of the amount of interest paid.
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Nikhil Kaushik

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Nikhil Kaushik (Expert)
20 May 2014 you are welcome Tara...good luck...
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