TDS

Querist : Anonymous (Querist) 09 June 2010 This query is : Resolved
Respected Expert

Plese guide me on the following matter

TDS on director commission based on profit goverened under which section of tds rules.whether it is 194H or 192B or any other section.

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Jagmohan Rawat (Expert) 09 June 2010
Directors commission is part of his managerial remuneration earned from the company. Hence TDS thereon is to be governed by section 192B.

A V Vishal (Expert) 09 June 2010
Sec 17 defines "SALARY" - one of the clauses reads as under -
any fees, commissions, perquisites or profits in lieu of or in addition to any salary or wages;

Commission to a Director will be taxable under the head salary and TDS on the same shall be deducted u/s 192B.

However it is subject to the agreement between the director & the company, TDS can be deducted u/s.194H.

Vineet (Expert) 11 June 2010
What is section 192B?

If the commission payable to Director arises out of his service contract, the same is chargeable to tax under head salaries and therefore TDS is to be deducted u/s 192.

However, if the Company has a seperate contract with such director to pay him certian commission in relation to sales, purchases, transaction in assets and valuables with no relation to his terms of service, the TDS on such brokerage or commission shall be deducted u/s 194H.

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