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Tds on gift vouchers

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MAXIM FERNANDES

Partner

33 Points Posted on 17 August 2015

Dear Experts,

In a Shopping Mall as a promotion activity and to attract customers we give gift vouchers to customers on selection basis. Whether TDS is applicable on Gift vouchers? If Yes at what rate and how we can account for it

For Ex:Gift voucher denominations are say 500 or 1000. how much TDS to be deducted?

Replies (3)

Rashi Bajaj

477 Points Posted on 17 August 2015

No TDS deductible as gift coupons given do not represent payment in terms of any contract/professional fees, etc. It is as good as discount given.

MAXIM FERNANDES

Partner

33 Points Posted on 18 August 2015

Thank you for the reply.

When we give motor car or motor bike as gift we deduct TDS @ 30%. Similarly when we give gift vouchers to customers whether TDS is applicable is my question.

Vishal Goel

Chartered Accountant

1725 Points Posted on 21 October 2015

Hello ,Maxim

Yes you are right in the case of motor car we deduct TDS but if we give gift voucher to customer then no need to deduct TDS because it is like a discount voucher & it will be adjusted against sale invoice. We are not giving any cash...it is discount.

If we give cash then we need to deduct tds…