TDS on Payments made for usage of Service Apartments
This query is : Resolved
13 July 2011
In case a company pays an amount to another resident company for one-time usage of Service Apartments, does the transaction attract TDS?
Service Apartments provides both boarding facilities, food and other recreations and the invoice amount is usually inclusive of the above charges.
If the payment had been on regular basis, should 194I be invoked or 194C?
Service Apartments provides both boarding facilities, food and other recreations and the invoice amount is usually inclusive of the above charges.
If the payment had been on regular basis, should 194I be invoked or 194C?
chetan soni
(Expert)
13 July 2011
This is some kind of tricky question;
Yes, you must deduct the TDS if the amount paid/payable is more than limits prescribe.
Firstly you need to see the agreement which defines the rent & scope of the facilities. If the agreement is very silent about the additional facilities like food and other recreations then you must apply 194I section. If agreement has some scope define on food and other recreations then you need to follow the following;
> Deduct TDS on service apartment charges u/s 194I, and
> Deduct TDS on other facilities u/s 194C, provided bill/invoice must cover both the things separately.
If invoice has single amount without separation then then apply 194I on total amount.
Yes, you must deduct the TDS if the amount paid/payable is more than limits prescribe.
Firstly you need to see the agreement which defines the rent & scope of the facilities. If the agreement is very silent about the additional facilities like food and other recreations then you must apply 194I section. If agreement has some scope define on food and other recreations then you need to follow the following;
> Deduct TDS on service apartment charges u/s 194I, and
> Deduct TDS on other facilities u/s 194C, provided bill/invoice must cover both the things separately.
If invoice has single amount without separation then then apply 194I on total amount.
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