TDS on Rewards
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
06 March 2011
Dear All,
Plz help me in solving this query.
A private ltd co. gives rewards in kind (eg: bike, refrigerator, TV etc) to its distributors if they complete a certain target. Is it liable to deduct TDS on such rewards. If so then under which section and at what rate.
Plz help me in solving this query.
A private ltd co. gives rewards in kind (eg: bike, refrigerator, TV etc) to its distributors if they complete a certain target. Is it liable to deduct TDS on such rewards. If so then under which section and at what rate.
06 March 2011
If the gift is in cash, tax will be deducted from cash prize.
If the gift is not in cash or in kind, the payer has to collect the liability for tax deduction from payee.
The payee needs to deposit the amount first with the payer...
For example let Mr. a win scooter from Bajaj Company and the value of scooter is 30000. The tax liability will be 9270 (30.9% of 30000) which either recovered by Bajaj company from Mr. a or Mr. a can directly deposit this amount with the government.
If the gift is not in cash or in kind, the payer has to collect the liability for tax deduction from payee.
The payee needs to deposit the amount first with the payer...
For example let Mr. a win scooter from Bajaj Company and the value of scooter is 30000. The tax liability will be 9270 (30.9% of 30000) which either recovered by Bajaj company from Mr. a or Mr. a can directly deposit this amount with the government.
Message likes :
1 times
06 March 2011
I request other experts too to give their view on this point as I am a bit confused whether the rewards in kind given by Co. in this case qualifies as gift or not.
06 March 2011
TDS WILL BE DEDUCTED
Message likes :
1 times
06 March 2011
In the cases where in incentives to promote sales are given to the distributors or commission agents in cash, they ordinarily require tax deduction at source as commission under Section 194H of the Income tax Act,1961. In the case of lottery winnings, there is specific provision that, where the winnings are in kind, payment of tax on equivalent value has to be ensured by the giver under Section 194B of the above said act before parting with the winnings. There is no such similar provision in Section 194H. But it stands to reason that the value of motor bike, television etc., has to be included as commission and tax has to be deducted thereon under section 194H of the said act.
Message likes :
1 times
07 March 2011
I think rewards in kind given by a company to distributors fall u/s 194H and TDS is to be deducted @ 10%
Message likes :
1 times
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Supply through E-commerce Operators
- STCG....................................................
- AMOUNT RECEIVED UNDER COMPULOSRY ACQUISITION OF AGRICULTURAL LAND
- TAN for Partnership
- Sales return eway bill
- Relief u/s Section 89
- REGARDING GST LIABILITY/....
- Specified Profession
- Is E Way Bill Valid If Transport ID Not Mentioned in PART A But Vehicle details mentioned in PART B
- STCG FOR GOLD ETFs
- Section 54F - Exemption on LTCG in 2026 for HP purchased in 2023
- Sales amount in Gstr1
- CG after sale of flat
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
- Annexure B utility for GST Refund
- Tax amount diff in Gstr1 and 3B in tax compare reports
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
