my client has partnership firm, turnover 2 croes over. my doubt was firm took loan from one of it's partner rs. 8 lakhs monthly interest exceed 50,000 rupees. can I deduct tds on such partner ?
tds applicable or not sir
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TDS on partnership
Replies (5)
No. TDS not applicable over Interest paid by a partnership firm to its partners.
there would be a liabilty to make tds u/s 194A of income tax act, as it exceeds the threshold limit
Interest on loan from partner- TDS applicable. ; Interest on partners capital- TDS not applicable.
When interest is paid by the firm to its partner(s), provisions of under section 194A are not applicable.
So no TDS on any interest paid by the firm to its partners.
As per section 194A(3)(iv) of the Income Tax Act, 1961 the interest paid to partners to not liable for deduction of TDS.
Refer the link - https://indiankanoon.org/doc/1155661/
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