A consultant has raised a bill of 45,000.00 comprising15,000 as re-imbursemnet and30,000.00 as professional charges. Now, as he has crossed the basic limit for chargebility of TDS u/s 194J, what will be the amount of TDS to be deducted?
Should I calculate TDS @ 10% on full bill amount45,000.00 or only on30,000.00.
How can I show the bill in accounts as15,000.00 is re-imbursement and balance is his professional charges?
Thanks in advance.
If he raised single bill then Tds will be deducted on entire amount. IF he seprate the bill then no tds will be deducted.
TDS to be deducted on gross amount.
Tax need not be deducted on reimbursement of expenses. TDS must be deducted only only on Rs. 30,000 in case reimbursement is separately mentioned in the invoice.
| Originally posted by : Divya K S | ||
 |
Tax need not be deducted on reimbursement of expenses. TDS must be deducted only only on30,000 in case reimbursement is separately mentioned in the invoice. |
 |
Yes, the consultant has raised a single bill but within that single separately mentioned as Item 1) Professional Fees for ... and Item 2) re-imbursement of expenses towards ....
Does that mean I only need to charges TDS on Professional Fees?
| Originally posted by : Divya K S | ||
|
|
Tax need not be deducted on reimbursement of expenses. TDS must be deducted only only on30,000 in case reimbursement is separately mentioned in the invoice. |
|
Yes, the consultant has raised a single bill but within that single separately mentioned as Item 1) Professional Fees for ... and Item 2) re-imbursement of expenses towards ....
Does that mean I only need to charges TDS on Professional Fees Rs. 30,000.00, Though I'm paying the full Rs. 45,000.00 to him.
Yes, you need to deduct tax only on professional fee.
as per circular no.715 dtd 8.8.1995 reimbersement cannot be deducted out of bill amount.
but delhi bench of ITAT in the case of Dr.Willmar Schawabe India (P) Ltd held that if reimbursement seperately shown in the bill it is not subject to TDS
agreee with mr sunil
CAclubindia
