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Consultation charges

Raj Malhotra (47 Points)

14 December 2020

Is there a cap to consultaion fees ?

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6 Replies

ayusmita (Tax consultant) (5890 Points)
Replied 14 December 2020

In some consultation fees their is for example doctor

1 Like

Raj Malhotra (47 Points)
Replied 14 December 2020

Finance consultant ?

sabyasachi mukherjee (27849 Points)
Replied 14 December 2020

PROFESSIONAL SERVICES HAS BEEN DEFINED UNDER SECTION 194J.
NOW CONSULTANCY AND PROFESSIONAL SERVICES BOTH ARE WITHIN THE AMBIT OF TAXATION SERVICES.

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Raj Malhotra (47 Points)
Replied 14 December 2020

Thank you very much sir for the reply .
Can u please explain , as I am not CA and would like to know , if I give consulting to firm for rasing finance at lower rate of interest which suits the client . can I charge higher consultaion charges if agreeable to client ..

the CA of the firm objects ( kpmg) denies for the higher % of charges , they say there is law that I can't charge nor can the client pay me the higher % consultaion as fixed terms between me and my client .

My question is , is there any cap in % for consultation charges or finance broking ?

hope I am clear in my question .

awaiting reply .

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sabyasachi mukherjee (27849 Points)
Replied 14 December 2020

Income tax Act has defined the cap on professional services.
The limits are there.
But , whatever KPMG's has said it is not within the ambit of Chartered Accountants of India.
It is governed by seperate set of laws framed by competition commission of India a seperate autonomous body.

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Raj Malhotra (47 Points)
Replied 14 December 2020

Thank you very much so that's clear that if the transaction is documented with genuine reasoning and GST / IT is paid on consultaion charges then there is no worries and no cap is fixed ( if the project for which loan is take has feasibility)