Tds on reimbursible expenses of a pure agent

TDS 5355 views 8 replies

Sudhakar K C

Employee

77 Points Joined September 2012

We are a customs agent .We incur certain expenses as pure agent. Whether we need to deduct tax on such expenses which are reimbursed by our clients. Please clarify.

Replies (8)

Prashanth S K

Practice

148 Points Joined October 2009

Dear Sudhakar,

Since it is a mere reimbursement involving no income component for the client TDS need not be deducted. What is the document by which you are making the re-imbursement?

Prashanth.

Sudhakar K C

Employee

77 Points Joined September 2012

There is no document .we receive the cheque and pay the cheque .Sometimes after depositing in the bank.

Guest

Pure agent does not get TDS deducted on the reimburesment...

Sudhakar K C

Employee

77 Points Joined September 2012

IS there any document prescribed for this?

Prashanth S K

Practice

148 Points Joined October 2009

No document is prescribed for this. I just asked if you are re-imbursing by way of any document. Now you have clarified.

Prashanth.

CMA Devi Vara Prasad Korada

Finance

654 Points Joined August 2011

I agree with all,

But my doubt is whether you are asking about TDS on your payment to your vendor or about the TDS on payment received from your customer.

In case of payment received from your customer:

Customer is not required to deduct TDS while makking payment to you as it is pure agent service.

But in case when you are making payment to your vendor:

You are required to check whether the payment is covered under any of the provisions of TDS and deduct accordingly.

Regards

Devivaraprasad

CMA Devi Vara Prasad Korada

Finance

654 Points Joined August 2011

I agree with all,

But my doubt is whether you are asking about TDS on your payment to your vendor or about the TDS on payment received from your customer.

In case of payment received from your customer:

Customer is not required to deduct TDS while makking payment to you as it is pure agent service.

But in case when you are making payment to your vendor:

You are required to check whether the payment is covered under any of the provisions of TDS and deduct accordingly.

Regards

Devivaraprasad

SATISH CHAVAN

accountant

22 Points Joined December 2013

But in case when you are making payment to your vendor: You are required to check whether the payment is covered under any of the provisions of TDS and deduct accordingly.

Regards Devivaraprasad

Query for above:-

To deduct the TDS in above case if bill is given on customers name & not on name of pure agent.In such case who is liable to deduct TDS.Is customer liable to deduct TDS OR pure agent will deduct it. And what will be the amount of Reimbursement i.e. Including TDS or Excluding TDS ??

Thanks,

Satish Chavan