Tds on ngo

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Parag P Shah (Querist)
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03 October 2011 Dear Sir,

We had issued a Chq to an Institution who is an Non Profit Institutional in current FY.
So whether TDS attract and if TDS is liable then under which section to be deducted.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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03 October 2011 If you made a donation, then TDS is not deductible.

Parag P Shah

Parag P Shah (Querist)
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03 October 2011 its not an Donation... its Business Promotion

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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03 October 2011 I am not able to fully understand the substance of the transaction.

Can you please tell in detail the purpose for which the payment was made.

Parag P Shah

Parag P Shah (Querist)
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03 October 2011 The payment is made for to Non Profit Institutional, who has organised "Navratri Utsav" for which we have made an X amount of payment.

So whether TDS is applicable?

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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03 October 2011 It is a donation. You can give the transaction any name but in substance you have made a donation to the NGO.

The NGO may have displayed your name or banner during the utsav but it is still a donation.

So TDS is not required to be deducted.

Parag P Shah

Parag P Shah (Querist)
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03 October 2011 Yes it is true... That we have Banner at the site..

Thank You very much for the consultancy.

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