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TDS ON PAYMENT MADE TO RESORTS

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bhavan

MANAGER - HR & ADMIN

23 Points Posted on 03 January 2020

Dear Experts,

I need a clarification on TDS on payment made to resorts. Recently I took my staff to a resort for one day outing. (No stay). Food was served and we used the amenities in the resort. I would like to know whether TDS is applicable for payment to resort. If so, under what section.

Regards

Bhavan

Replies (5)

Quick Summary

This discussion seeks clarification on whether Tax Deducted at Source (TDS) applies to payments made to resorts for staff outings that include food and amenity usage, but no overnight stay. Experts debated the applicability of Section 194C, with differing views on whether the transaction constitutes a contract for services or a simple sale of food. The consensus leaned towards TDS not being applicable when the payment is directly to the resort for food and amenity use, without a formal contract or intermediary, and where no hotel stay is involved.

Ashok Kumar

CA qualified

270 Points Posted on 03 January 2020

TDS will not be applicable

CMA M.Keerthi chandra

C.A FINAL STUDENT AND QUALIFIED C.M.A

325 Points Posted on 03 January 2020

Yes T.D.S is applicable and the applicable Section is 194C.

bhavan

MANAGER - HR & ADMIN

23 Points Posted on 03 January 2020

Not clear with 194 C. Payment is made to resort directly. No middleman/agent. Food is served in the resort similar to food served in hotel. So it can't be considered as catering service. There is no contract with resort. Resort says TDS is not applicable.

Request clarity

Thanks