The Company has given a works contract to a contractor. In addition to the work contractor has done some works and actual cost of the work he has reimbursed from the company.
Whether TDS is applicable on this reimbursement of expenses?
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Tds on reimbursement of expenses
Replies (6)
Yes, u/s 194C.
U/s 194C reimbursement of expenses are not mentioned any where.
Reimbursement of actual expenses doesnt become his income. How TDS is attracted? Can you please elaborate further with a case law.
As per CBDT circular no 715 dated 08.08. 1995, if invoice raised contains both fees and reimbursements, then TDS to be deducted on entire invoice amount. However as per decision of Delhi ITAT in case of ITO Vs. Dr. Willmar Schwabe India (P.) Ltd. [2005] 3 SOT 71 if separate invoice raised only for reimbursement of expenses then no TDS on such reimbursements
Diretor has used cab service for company perpose.bill is in the name of director and he pay the bill. Now he reimbursement from the company, whether company need to follow RCM and TDS on such reimbursement?
| Originally posted by : Sunil gupta | ||
 |
Diretor has used cab service for company perpose.bill is in the name of director and he pay the bill. Now he reimbursement from the company, whether company need to follow RCM and TDS on such reimbursement? |  |
if the company books the expenses direct under travelling, then TDS issue would be between the cab service provider and company, and as the cab services are booked in lower amount brackets, which does not exceeds the threshold limit.
but if the company books the expenses as allowance and perks to the director, then the tds issue is between the director and company, and here the TDS provisions are applied,
YES TDS is applicable u/s 194C.
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