TDS on Director sitting fee
This query is : Resolved
13 January 2011
Pls guide us whether TDS is applicable on Directors sitting fees ( indian Director Attending Borard meeting only)
CA Sanat Pyne
(Expert)
13 January 2011
NO
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https://www.caclubindia.com/experts/tds-on-sitting-fees-of-directors-488190.asp
VISIT THIS LINK
https://www.caclubindia.com/experts/tds-on-sitting-fees-of-directors-488190.asp
13 January 2011
Sitting fee is received by a director of a company for attending meeting of the Board, or a committee thereof, attended by him/her.
By virtue of sub-section (2) of Section 198 of the Companies Act,1956 sitting fee paid to director's shall not be reckoned for the purpose of calculating Director's Remuneration.
In view of the above , the sitting fee received by a director has to be taxed under the head “income from other source “ and not salary.
More over,there is no specific provision in the Income tax Act,1961 for TDS on sitting fee payments and certainly section 194J of the said act will not apply.
By virtue of sub-section (2) of Section 198 of the Companies Act,1956 sitting fee paid to director's shall not be reckoned for the purpose of calculating Director's Remuneration.
In view of the above , the sitting fee received by a director has to be taxed under the head “income from other source “ and not salary.
More over,there is no specific provision in the Income tax Act,1961 for TDS on sitting fee payments and certainly section 194J of the said act will not apply.
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