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Is TDS Applicable on reimbursment of Expenses

Ramachandra (service) (36 Points)

27 November 2007

Marketing PR agencies claim reimbursment of expenses. They also charge service tax @ 12.36% on those reimbursment. Are these payments subject to TDS.

Please Advise.

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6 Replies

MANISH PANCHAL (service) (174 Points)
Replied 27 November 2007

Dear Ramchandra tds need not to be deducted on reimbursement of expenses provided seperate bill for such reimbursement of expenses provided by vendor or indicated in bill reimbursment of expenses seperately for details see it circular 715 dt.08.08.1985 Question no 30

Dayal (Gen. Manager - Indirect Taxation) (3431 Points)
Replied 27 November 2007

I agree with the views expressed by Manish. Every reimbursement has to be supported by a bill. mere figures will not establish that fact

swamy.cb (Manager-Accounts) (431 Points)
Replied 27 November 2007

Reimursement of expeness is realted to business and with support with bill. No need to deduct tax that.

CA. Vineet Grover (Chartered Accountant) (1538 Points)
Replied 27 November 2007

In addition to Circular No. 715, it need to be un derstood that re-imbursement should be supported with documents. if supportings are not attached with the re-imbursement the said expense shall be treatred as an allowane and applicable TDS rate shall be applicable depending on the nature of service provided

madhukar (finance) (30 Points)
Replied 25 November 2009

is there minimum limit of supporting for expenses, i.e. up to certiain limit supproting of invoices is not required.

Amit Mundra (ACCOUNT OFFICER) (66 Points)
Replied 22 September 2012

Hi every one i have a query is that we purchase goods from china but our client pay the freight cost from china to singapore. he claiming the reimbursment of thses exp. my query is that TDS will be applicable on above transation or not. becuase bank required 15 CA /CB for payment of is trasnsation so please resolve this issued and reply me.

Its urgent

Amit Mundra