No TDS

Respected all,

I had a small query.

One of our clients is a director in 2 different companies say Company A and Company B.

While deducting tax at source on the salary paid to him in A, his salary in B is also considered.

So now, he wants to apply to the company B to not to deduct tax at source on the salary paid to him in company B.

For no TDS or TDS at a lower rate, application in Form no. 13 is to be submitted.

My query is whether the assessee has to compulsarily submit Form 13 or a simple application made to the company will do.

If it is compulsary to file Form 13, then what is the procedure to do so?

Kindly guide me.

Thank you in advance.

Regards.

Replies (4)

Dear Aalhad,

Assessee has to file Form 13 to his Assessing Officer, in return assessing officer will require the assessee to submit the proof of payment of tax by Company A or u can voluntarirly attached this thing with Form 13.

If AO is satisfied he will issuue a certificatefor Lower or no deduction of Tax..

Assessee can submit that certificate with Company B, based on which TDS will not be deducted or deducted at a lower rate. 

assessee will file Form 13 to AO. In this form he has to submit three year details of income and advance tax etc. If AO is satisfy then he will issue certificate u/s 197. Then he can submit it to comapny B for non-deduction of TDS.

Thank you for the help.

I wanted know whether there will b any penalty for company B for no TDS if the assessee fails to submit a certificate obtained from AO.

Dear Aalhad,

Yes in the absence of certificate, if Co. B fails to deduct TDS then it can be held liable for such faliure.

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