TDS under section 194R

Save Share

This query is : Resolved

Quick Summary

Section 194R of the Income-tax Act, effective from 1st July 2022, requires tax to be deducted at source at 10% on benefits or perquisites provided to a resident. This applies whether the benefit is convertible to cash or not, as long as it arises from business or profession. However, no deduction is needed if the total value of benefits provided in a financial year doesn't exceed £20,000. Certain individuals or HUFs with turnover below specific limits are also exempt.

Daya

Daya (Querist)

19 June 2022 when TDS to be deducted under section 194R.
what is criteria to deduct TDS.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

19 June 2022 Finance Act 2022 inserted a new section 194R in the Income-tax Act, 1961 with effect from 1St July 2022. The new section mandates a person, who is responsible for providing any benefit or perquisite to a resident, to deduct tax at source @10% of the value or aggregate of value of such benefit or perquisite, before providing such benefit or perquisite. The benefit or perquisite may or may not be convertible into money but should arise either from carrying out of business, or from exercising a profession, by such resident. This deduction is not required to be made, if the value or aggregate of value of the benefit or perquisite provided or likely to be provided to the resident during the financial year does not exceed twenty thousand rupees. The responsibility of tax deduction also does not apply to a person, being an Individual/Hindu undivided family (HUF) deductor, whose total sales / gross receipts / gross turnover from business does not exceed one crore rupees, or from profession does not exceed fifty lakh rupees, during the financial year immediately preceding the financial year in which such benefit or perquisite is provided by him.

Message likes : 1 times