TDS on gifts or incentives

Neha (ENTREPRENEUR) (200 Points)

12 January 2023  

Section 194R: 
Deduction of tax in case any benefit or perquisite is provided and aggregate value of such benefit/perquisite exceeds Rs. 20,000. Benefit or perquisite should be arising from business or the exercise of a profession by such resident.

Note: This statement is saying that a benefit (such as a financial gain or special privilege) should only be given to someone if it is a result of their business or professional activities. In other words, the benefit should be directly related to the work that the individual is doing, and not be given as a form of personal gain or favoritism. This section includes tour packages, free samples, gifts, gift vouchers/coupons or incentives.

TDS Rate = 10%