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TDS for Boarding & Lodging

11 May 2020

Dear Friends,

What about TDS for Boarding & Lodging. Sometimes we are hiring Hotel Rooms for monthly basis. In this case any TDS impact u/s 194I ?

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7 Replies

sujith kumar dasa (banglore) (1496 Points)
Replied 11 May 2020

Yes TDS is applicable @ 10% under sec 194I if the limit of Rs. 240000 is crossed

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CA Garima (Assistant Manager) (113 Points)
Replied 11 May 2020

According to my opinion 194I is not applicable in this case since we are not paying for the use of Building i.e payment made is not rental nature. However,we are taking composite service including food, housekeeping etc.

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Mohanraj J (1162 Points)
Replied 11 May 2020

Garima Ji, am also thinking same. we are hiring Boarding n Lodging on need basis only and not for a monthly basis. Some months we are hiring 7 days, sometimes we are hiring 57 days.

Kiran Hathalia (831 Points)
Replied 11 May 2020

In my view section 194C shall be applicable on boarding and lodging expenses.

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Nihit Somani (110 Points)
Replied 11 May 2020

Where earmarked rooms are let out for a specified rate or period, they would be construed as accommodation made available on regular basis and would be termed as rent. Even if the rooms are not earmarked but hotel has legal obligation to provide such rooms would also be in form of rent.

However, there are few instances where corporate employers etc enter into agreements with hotels just to fix the room tariffs of hotel rooms for their people. Such agreements are in the nature of rate contract agreements. In this case, it cannot be said to be accommodation on regular basis and accordingly TDS under section 194I shall not apply in this case.

Trust this clarifies.
Regards,
Nihit Somani

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