PLEASE LET ME KNOW THE TDS RATES APPLICABLE TO DOMESTIC AS WELL AS INTERNATIONAL TOUR OPERATOR
yathiraj j (PRACTICE CA) (30 Points)
03 February 2010PLEASE LET ME KNOW THE TDS RATES APPLICABLE TO DOMESTIC AS WELL AS INTERNATIONAL TOUR OPERATOR
Amir
(Learner)
(4016 Points)
Replied 03 February 2010
Dear yathiraj,
TDS is not applicable
Payments to airlines/travel agents - The provisions of section 194C do not apply to the payments made to the airlines or the travel agents for purchase of tickets for air travel of individuals. The provisions shall however apply when payments are made for chartering an aircraft for carriage of passengers or goods. This clarification will apply mutatis mutandis to the tickets for travel of individual by any other mode of transport also—Circular : No. 713, dated 2-8-1995.
The payments made to a travel agent or an airline for purchase of a ticket for travel would not be subjected to tax deduction at source as the privity of the contract is between the individual passenger and the airline/travel agent, notwithstanding the fact that the payment is made by an entity mentioned in section 194C(1). The provisions of section 194C shall however apply when a plane or a bus or any other mode of transport is chartered by one of the entities mentioned in section 194C—Circular : No. 715, dated 8-8-1995.
Anumanchipalli Sathikonda
(Tax Consultant)
(1349 Points)
Replied 03 February 2010
Mr.Yatiraj J
In the explanation to section 194C work has been denifined
(iv) "work" shall include
(c) carriage of goods or passengers by any mode of transport other than railways;
Hence the provisions of section 194C will apply for tour operators.
If the tour operator is an Individual or Hindu Undivided Family the rate of tax is 1% (One Percent)
If the tour operator is other than an Individual or Hindu Undivided Family the rate of tax is 2% (Two Percent)
Best Wishes
Sathikonda
Anumanchipalli Sathikonda
(Tax Consultant)
(1349 Points)
Replied 03 February 2010
Mr. Amir
I think the question is regarding a Tour Operator who operates group tours for the employees of a company etc.,
Anyhow it is to be clarified by Mr.YatiRaj J in which context he has posted the question.
Best Wishes
Sathikonda
Amir
(Learner)
(4016 Points)
Replied 03 February 2010
Dear Sathikonda,
Agree with u that applicability of TDS is there however for cases mentioned in circular benefit can be obtained.
CAclubindia
