Tds on vpn charges

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

03 August 2011 Please provide me your valueable view on TDS aplicability on the VPN Charges

VPN Charges means voice processing network provided by some telecom companies to the corporates, where they can talk to diffrent offices of the same organisation at diffrent location. eg by dialling 88 and then extn number we connect to the suppose Mumbai Office.

My finding is that it is not a ordinary telephone line, but a specilised service priovided by the telecom companies to big corporates only.

Please provide your views that same is subject to TDS u/s 194J of the Income tax act, 1961 or not. also please let us know, which of the services provided by leased line are subject to TDS

Querist : Anonymous

Querist : Anonymous (Querist)

03 August 2011 I agree with the above. VPN charges should be taxable under section 194J. I also suggest to refer the book TDS is not Tedious by CIT Mr. Sanjai Kumar Verma where it mentioned that internet charges & Bandwidth charges are also covered under section 194J.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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07 August 2011 VPN Charges Service,
Internet Charges and Band width Charges are covered under Information Technology.
Notification No. SO 385(E) dated 04-05-2001
covers profession of information technology into the definition of notified profession for the purpose of section 44AA.

TDS will be deducted U/s 194J on payments towards VPN Charges etc.

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