Hi,
please let me know about the accounting treatment for the payment made to existing customers who win cash prizes on successful referral of our products.
1.Do we require any invoice from his for the payment?
2.Will the TDS attract it?
3. Do we need to take declaration under section 206AB in this regard.
4. How we set off payment in our book if we do not collect invoices for them?
please assist me in this regard
thanks
Treat it as commission. there are other ways that it can be accounted. that is if you will reallocate the discount given on other products. In my view... its in nature of Commission, hence TDS is applicable. Then who ever seeks referral, you need to have an identity. If it is online then you will get a notification. In the end, it is commission, TDS applicable and not sure about 206AB
CAclubindia
