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TDS on NSDL Fees

MANJUNATHA (ACCOUNTANT) (21 Points)

17 September 2024

As per MCA notification all private ltd companies to issue securities in dematerialized form. For this NSDL/CDSL will charge govt fees as joining fees and annual custody fees, are this fees are subject to TDS. if so, under which section & what rate.

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Rama chary Rachakonda (Master in Accounts & high court Advocate email ID:ramachary64@gmail.com voice no:9989324294) (8005 Points)
Replied 17 September 2024

Yes, the fees charged by NSDL/CDSL for dematerialization of securities are subject to TDS. The government fees paid to NSDL/CDSL for dematerialization of securities are considered as "professional services" and are liable for TDS under Section 194J of the Income Tax Act, 1961. The TDS rate applicable would be 10% (plus applicable surcharge and cess). However, if the payee (NSDL/CDSL) has a permanent account number (PAN), the TDS rate would be 10% of the fees paid. If the payee does not have a PAN, the TDS rate would be 20% of the fees paid. Please consult a tax professional or chartered accountant to ensure compliance with the TDS regulations and to determine the correct TDS rate and payment procedure.

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Scott Luna (no) (22 Points)
Replied 12 December 2024

As per the MCA notification, all LLCs are required to issue securities in non-physical form. Regarding the fees charged by NSDL/CDSL to the government, such as the joining fee and annual custody fee, these fees may be subject to tax deduction (TDS).

As per the regulations, this service fee is usually subject to tax deduction under Section 194J of the Income Tax Act, at the rate of 10%. However, you should check the specific regulations and applicable conditions to ensure accuracy. poppy playtime chapter 3