TDS New Rules : 10% TDS will be applicable on gifts, new rules will be applicable from July 1, doctors and influencers will also come under the ambit

0
456
Big relief to investors! TDS will not be deducted on the interest of this scheme, know details
Big relief to investors! TDS will not be deducted on the interest of this scheme, know details

Under the new TDS rule going to come into effect from July 1, now TDS will be deducted on transactions of additional benefits between two businessmen or professionals. Apart from cash, these gifts or benefits can also be cars, sponsored trips, movie tickets etc.

The new rule related to TDS will come into effect from July 1. In the new rule, a new section 194R has been added to the Income Tax Act. Under which if a benefit of Rs 20,000 or more is given in a financial year, then 10 percent TDS will be deducted on it. Its provision was made in the budget presented in February 2022.

- Advertisement -

Kamlesh C Varshney, Joint Secretary in the Ministry of Finance said that such facilities come in additional benefits and tax will be applicable on it. Along with this, the Finance Ministry has also said to remove the confusion on this. Explain that TDS will be received by the giver of the gift from the receiver.

Apart from cash benefits, TDS will also be deducted,

it is not necessary that TDS will be deducted only on cash benefits given to anyone. This will attract TDS on shares, car, sponsored business trip or conference event being given to the directors of the company.

If benefits or allowances are paid to the proprietor, director or any of their relatives who are not engaged in any kind of business or profession in a private capacity, they will come under the purview of TDS.

Also, TDS will be levied on free samples, tickets and other sponsored materials given to doctors. Taxpayers should note that even if the benefits in your hands are out of the tax slab, TDS will be deducted.

Social Media Influencers also as per the provision in the purview

if a social media influencer retains a sponsored item of a company after promotion, then TDS will also be levied on it. However, this provision will not apply if he returns the same.

Where this rule will not apply

If sales discount, cash discount, or rebated offers are given to the customers, then this provision will not be applicable. However, TDS will be applicable if the seller gives any discount other than the above.

Chartered Accountant Prakash Hegde says that this provision will be applicable to the benefits transaction between 2 professionals or business person but if the relationship is between owner and employee then it will not be applicable.

 

- Advertisement -