vipul khanna (accountant) (89 Points)
07 May 2018SIR, TDS IS APPLICABLE ON INTEREST PAID ON SECURED LOAN FROM BANK OR NBFC, IS THERE IS ANY AMOUNT LIMIT
Ajay
(CA Job)
(512 Points)
Replied 09 May 2018
Dear Vipul
Regards
Ajay
vipul khanna
(accountant)
(89 Points)
Replied 10 May 2018
sir we are paying the amount through emi everymonth on our secured loans from nbfc and at the end of finacial year we had made a journal entry for interest debit during the year for reconcilation of principal balance outstanding, so on that amount tds is applicable or not
Ajay
(CA Job)
(512 Points)
Replied 10 May 2018
Dear Vipul
You may please conitnue making the journal entries to account for the interest component of EMI.
I am sharing an article with regards to this - https://www.simplifiedlaws.com/tds-on-interest-paid-to-nbfc-with-emi/
As per this post, you keep making TDS remittance in respect of interest component on EMI on a monthly basis out of your pocket and also file quarterly TDS returns regularly and issue TDS certiifcates for each quarter. Then, while issuing the TDS certificate, write to your lender NBFC to make the refund of the TDS amount.
You may also talk to the lender NBFC directly for any other more practical solution as many other borrowers may be facing the same problem.
Regards
Ajay
CAclubindia
