In case of professionals,Foreign or Indian, whether their personal exps. reimbursement will attract TDS, when such reimbursement mentioned in their contracts itself.
01 February 2012
When the reimbursement amount is fixed (say Rs 10000 pm), then it takes the nature of income and TDS will get attracted.
However when the amount of reimbursement is in line with the expenses incurred (contract says that, reimbursements will be made to the extent of actual expenses incurred) and claimed after supporting proper expense documents/explanations, then they will not attract TDS.
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