There is no technical issue if an employee raises a service invoice with his company. The only thing is that it should not violate his appointment terms with the company.
There is no technical issue if an employee raises a service invoice with his company. The only thing is that it should not violate his appointment terms with the company.
A vendor registered under the MSMED Act, 2006 is called an MSME vendor. There are three categories of vendors in MSMED act which are based on their investment and turnover. Micro manufacturing and services units- Rs. 1 Crore of investment in plant and machinery or equipment and Rs 5 Crore of turnoveRead more
A vendor registered under the MSMED Act, 2006 is called an MSME vendor. There are three categories of vendors in MSMED act which are based on their investment and turnover.
Micro manufacturing and services units- Rs. 1 Crore of investment in plant and machinery or equipment and Rs 5 Crore of turnover.
Small manufacturing and services units- Rs. 10 Crore of investment investment in plant and machinery or equipment and Rs 50 Crore of turnover.
Medium manufacturing and services units- Rs. 50 Crore of investment in plant and machinery or equipment and Rs. 250 Crore of turnover.
Yes, TDS @10% shall be deducted from the membership fee U/s 194J. Membership fees collected by an association usually include access to managerial, technical, and consultancy services, reflecting the benefits provided to members. Consequently, such fees are subject to TDS at 10% under Section 194J.Read more
Yes, TDS @10% shall be deducted from the membership fee U/s 194J.
Membership fees collected by an association usually include access to managerial, technical, and consultancy services, reflecting the benefits provided to members. Consequently, such fees are subject to TDS at 10% under Section 194J.
Exemption: where the amount of such sum or, the aggregate of the amounts of such sums credited or paid during the financial year does not exceed by INR 30000.
As per Section 194J, professional fee means:
(a) “professional services” means services rendered by a person in the course of carrying on legal, medical, engineering or architectural professions or the profession of accountancy or technical consultancy or interior decoration or advertising or such other profession as is notified by the Board for the purposes of section 44AA or of this section;
(b) “fees for technical services” means rendering of any managerial, technical or consultancy services
What is allowed Cash Payment-up to INR 10,000 Cash receipt- below to INR 2 Lakhs (up to 20,000 for Loan and Advance) Cash Payment of Loan/advance--below 20,000 Now let's discuss the complete provision Section 40A(3) and Section 43 – Cash Payment Section 269SS and Section 269ST – Cash ReceipRead more
What is allowed
Cash Payment-up to INR 10,000
Cash receipt- below to INR 2 Lakhs (up to 20,000 for Loan and Advance)
Cash Payment of Loan/advance–below 20,000
Now let’s discuss the complete provision
Section 40A(3) and Section 43 – Cash Payment
Section 269SS and Section 269ST – Cash Receipts
Section 269T – Repayment of Certain Loans / Deposits
1. Section 40A(3)
Cash Payment
Payment for any expenditure of over Rs.10,000 is made in cash, then the expenditure will be disallowed.
Exemption:
Payment though banking channels like debit card, account transfer, cheque or demand draft, digital payments.
Section 269ST
Cash receipt limit- Receipt of cash amount of Rs 2 Lakh or more not allowed
In aggregate from a person in a day; or
In respect of a single transaction; or
In respect of transactions relating to one event or occasion from a person.
Exemption:
On cash received through an Account Payee Cheque/Draft or through a bank account/post office.
To Government, any banking company, post office savings bank or co-operative bank.
To such other persons or class of persons or receipts, which the Central Government may specify.
Penalty under Section 269ST
Equal to the amount of receipt is payable.
Section 269SS
Cash receipt limit
Receipt of cash amount of more than Rs 20,000 not allowed from Loan/Deposit/advance
Exemption
Up to INR 20,000
From Government;
From any banking company, post office saving bank or co-operative bank;
From ny corporation established by a Central, State or Provincial Act
From any Government company as defined in section 2(45) of the Companies Act, 2013
From an institution, association or body or class of institutions, associations or bodies notified by Central Government in the official gazette.
If both the person, have agricultural income and do not have any taxable income then section 269SS will not apply.
Penalty under Section 269SS
Equal to the amount of loan or deposit or specified sum accepted.
Section 269T
Repayment of Loans / Deposits with Interest (in his name or jointly with another person)- INR 20,000 or more not allowed otherwise than by an account payee cheque or account payee bank draft
Applicable to any branch of a banking company or a co-operative society, firm or another person
Exemption:
When the loan is repaid, or deposit taken or accepted from below mentioned person:
Below to INR 20,000
Government;
Any banking company, post office saving bank or co-operative bank;
Any corporation established by a Central, State or Provincial Act
Any Government company as defined sec 2(45) of the Companies Act, 2013
An institution, association or body or class of institutions, associations or bodies notified by Central Government in the official gazette.
Penalty under Section 269T
Equal to the amount of loan or deposit repaid is payable.
Hi, This single question covers two questions in itself Applicability of TDS on consultancy services on NRI (Bhutan Citizen) Requirement of form 15ca/15cb on payment made to a resident of Bhutan. Section 195 of the Income Tax Act, 1961 covers the TDS provision on the payments made by an individualRead more
Hi,
This single question covers two questions in itself
Applicability of TDS on consultancy services on NRI (Bhutan Citizen)
Requirement of form 15ca/15cb on payment made to a resident of Bhutan.
Section 195 of the Income Tax Act, 1961 covers the TDS provision on the payments made by an individual by way of interest or any other amount other than salary to an NRI or a foreign company and also requires the payer to furnish an undertaking in the form 15CA along with a certificate of Chartered Accountants in form 15CB.
Now let’s discuss the first issue involved in the question:
The TDS liability in India is to be decided on two levels:
First with reference to the provision of this section of the Income Tax Act and
Second with reference to the provision of the Tax treaty/Double Taxation Avoidance Agreement (DTAA) between India and the country of residence of the NR receiver.
Now if you refer the clause 2 of article 12 of the DTTA between the Indian Government and the Roya Government of Bhutan, it is clearly stated that
Royalties or fees for technical or professional services may also be taxed in the Contracting State i.e India, and according to the laws of that State, but if the beneficial owner of the royalties or fees for technical or professional services is a resident of the other Contracting State i.e Bhutan than the tax so charged shall not exceed 10 percent of the gross amount of the royalties or fees for technical or professional services.
Now let’s discuss the second issue involved in the question i.e requirement of form 15CA and 15CB:
Form 15CA and 15CB are not required to be furnished for remittance in two cases:
if it is covered in the negative list of RBI as per rule 37BB.
if the remittance is made by an individual and it does not require prior approval of RBI [as per the provisions of section 5 of the Foreign Exchange Management Act, 1999 (42 of 1999) read with Schedule III to the Foreign Exchange (Current Account Transaction) Rules, 2000]
In your case, it is not covered in the negative list, hence forms 15CA and CB is required to be furnished, there is no such exemption for the country of an NRI.
Following are the differences between advances and loans. A Loan is a financial assistance given with an absolute promise to repay, whereas an advance is given against the supply of goods and services. Generally, Loan carries a rate of Interest against the financial assistance whereas an Advance doeRead more
Following are the differences between advances and loans.
A Loan is a financial assistance given with an absolute promise to repay, whereas an advance is given against the supply of goods and services.
Generally, Loan carries a rate of Interest against the financial assistance whereas an Advance does not carry such a rate of interest.
A loan can be for a long-term period whereas an advance is given for a short-term period and against work or project.
A loan is always repaid, whereas an advance is adjusted with the outstanding bill amount.
Example-Advance given to employees against the current month’s salary. A loan is given to employee for buying a Car.
Please refer the rule 3 of the Companies (Incorporation) Rules, 2014, which provides that only a natural person who is an Indian citizen and resident in India is eligible to incorporate OPC. Therefore, the question of any “body corporate” or other organizations can not constitute a One person companRead more
Please refer the rule 3 of the Companies (Incorporation) Rules, 2014, which provides that only a natural person who is an Indian citizen and resident in India is eligible to incorporate OPC. Therefore, the question of any “body corporate” or other organizations can not constitute a One person company. Naturally, they are not a natural person.
Hi, Section 135 of Companies Act is applicable to every company which is having : • net worth of Rs 500 crore or more; or • turnover of Rs 1000 crore or more; or • a net profit of Rs 5 crore or more during any of the three preceding financial years. The word used here is ’every company’, However, iRead more
Hi,
Section 135 of Companies Act is applicable to every company which is having : • net worth of Rs 500 crore or more; or • turnover of Rs 1000 crore or more; or • a net profit of Rs 5 crore or more during any of the three preceding financial years.
The word used here is ’every company’, However, in terms of rule 6(2) of companies (Incorporation) Rules, 2014, an OPC loses its status if paid-up capital exceeds Rs. 50 lakhs or average annual turnover is more than 2 crores in three immediate preceding consecutive years.
In view of this, it is quite clear that an OPC would not meet the criteria specified in section 135 as detailed above.
Hi, Please refer to section 149(1) of the Company Act,2013, according to which: A One Person Company needs to have a Board of Directors consisting of individuals as directors and shall have a minimum of one director. It can have directors up to a maximum of 15 which can also be increased by passingRead more
Hi,
Please refer to section 149(1) of the Company Act,2013, according to which:
A One Person Company needs to have a Board of Directors consisting of individuals as directors and shall have a minimum of one director. It can have directors up to a maximum of 15 which can also be increased by passing a special resolution as in case of any other company.
Section 24(b) of the Income Tax Act allowed the deduction of Interest paid on money borrowed for the purpose of purchase, repairs, renovation, etc. of house. However, it is not necessary that the money should have been borrowed as a home loan or from any banking institution. Interest paid to your fRead more
Section 24(b) of the Income Tax Act allowed the deduction of Interest paid on money borrowed for the purpose of purchase, repairs, renovation, etc. of house. However, it is not necessary that the money should have been borrowed as a home loan or from any banking institution.
Interest paid to your friends and relatives in respect of money borrowed for the purposes specified above can also be claimed under section 24(b).
But the actual use of the personal loan should be only for the purpose of the purchase, repairs, renovation, etc. To prove this, the personal loan should be taken through a bank account and the expenditures made for the above purpose and payment of interest should also be made from the bank account.
Can an employee raise invoice for other services apart to taking salary?
There is no technical issue if an employee raises a service invoice with his company. The only thing is that it should not violate his appointment terms with the company.
There is no technical issue if an employee raises a service invoice with his company. The only thing is that it should not violate his appointment terms with the company.
See lessWho is called a MSME vendor?
A vendor registered under the MSMED Act, 2006 is called an MSME vendor. There are three categories of vendors in MSMED act which are based on their investment and turnover. Micro manufacturing and services units- Rs. 1 Crore of investment in plant and machinery or equipment and Rs 5 Crore of turnoveRead more
A vendor registered under the MSMED Act, 2006 is called an MSME vendor. There are three categories of vendors in MSMED act which are based on their investment and turnover.
- Micro manufacturing and services units- Rs. 1 Crore of investment in plant and machinery or equipment and Rs 5 Crore of turnover.
- Small manufacturing and services units- Rs. 10 Crore of investment investment in plant and machinery or equipment and Rs 50 Crore of turnover.
- Medium manufacturing and services units- Rs. 50 Crore of investment in plant and machinery or equipment and Rs. 250 Crore of turnover.
See lessIs TDS deducted on Membership Fee?
Yes, TDS @10% shall be deducted from the membership fee U/s 194J. Membership fees collected by an association usually include access to managerial, technical, and consultancy services, reflecting the benefits provided to members. Consequently, such fees are subject to TDS at 10% under Section 194J.Read more
Yes, TDS @10% shall be deducted from the membership fee U/s 194J.
Membership fees collected by an association usually include access to managerial, technical, and consultancy services, reflecting the benefits provided to members. Consequently, such fees are subject to TDS at 10% under Section 194J.
Exemption: where the amount of such sum or, the aggregate of the amounts of such sums credited or paid during the financial year does not exceed by INR 30000.
As per Section 194J, professional fee means:
(a) “professional services” means services rendered by a person in the course of carrying on legal, medical, engineering or architectural professions or the profession of accountancy or technical consultancy or interior decoration or advertising or such other profession as is notified by the Board for the purposes of section 44AA or of this section;
(b) “fees for technical services” means rendering of any managerial, technical or consultancy services
See lesscash limit a day
What is allowed Cash Payment-up to INR 10,000 Cash receipt- below to INR 2 Lakhs (up to 20,000 for Loan and Advance) Cash Payment of Loan/advance--below 20,000 Now let's discuss the complete provision Section 40A(3) and Section 43 – Cash Payment Section 269SS and Section 269ST – Cash ReceipRead more
What is allowed
Now let’s discuss the complete provision
1. Section 40A(3)
Cash Payment
Exemption:
Section 269ST
Cash receipt limit- Receipt of cash amount of Rs 2 Lakh or more not allowed
Exemption:
Penalty under Section 269ST
Section 269SS
Cash receipt limit
Exemption
Penalty under Section 269SS
Equal to the amount of loan or deposit or specified sum accepted.
Section 269T
Exemption:
When the loan is repaid, or deposit taken or accepted from below mentioned person:
Penalty under Section 269T
Equal to the amount of loan or deposit repaid is payable.
See lessDo we require the 15CA CB to process the consultant payment from India to Bhutan?
Hi, This single question covers two questions in itself Applicability of TDS on consultancy services on NRI (Bhutan Citizen) Requirement of form 15ca/15cb on payment made to a resident of Bhutan. Section 195 of the Income Tax Act, 1961 covers the TDS provision on the payments made by an individualRead more
Hi,
This single question covers two questions in itself
Section 195 of the Income Tax Act, 1961 covers the TDS provision on the payments made by an individual by way of interest or any other amount other than salary to an NRI or a foreign company and also requires the payer to furnish an undertaking in the form 15CA along with a certificate of Chartered Accountants in form 15CB.
Now let’s discuss the first issue involved in the question:
The TDS liability in India is to be decided on two levels:
Now if you refer the clause 2 of article 12 of the DTTA between the Indian Government and the Roya Government of Bhutan, it is clearly stated that
Royalties or fees for technical or professional services may also be taxed in the Contracting State i.e India, and according to the laws of that State, but if the beneficial owner of the royalties or fees for technical or professional services is a resident of the other Contracting State i.e Bhutan than the tax so charged shall not exceed 10 percent of the gross amount of the royalties or fees for technical or professional services.
Now let’s discuss the second issue involved in the question i.e requirement of form 15CA and 15CB:
Form 15CA and 15CB are not required to be furnished for remittance in two cases:
In your case, it is not covered in the negative list, hence forms 15CA and CB is required to be furnished, there is no such exemption for the country of an NRI.
Thanks.
See lessWhat is the difference between advance and loan?
Following are the differences between advances and loans. A Loan is a financial assistance given with an absolute promise to repay, whereas an advance is given against the supply of goods and services. Generally, Loan carries a rate of Interest against the financial assistance whereas an Advance doeRead more
Following are the differences between advances and loans.
A Loan is a financial assistance given with an absolute promise to repay, whereas an advance is given against the supply of goods and services.
Generally, Loan carries a rate of Interest against the financial assistance whereas an Advance does not carry such a rate of interest.
A loan can be for a long-term period whereas an advance is given for a short-term period and against work or project.
A loan is always repaid, whereas an advance is adjusted with the outstanding bill amount.
Example-Advance given to employees against the current month’s salary. A loan is given to employee for buying a Car.
See lessCan a company form a One Person Company (OPC) as its subsidiary?
Please refer the rule 3 of the Companies (Incorporation) Rules, 2014, which provides that only a natural person who is an Indian citizen and resident in India is eligible to incorporate OPC. Therefore, the question of any “body corporate” or other organizations can not constitute a One person companRead more
Please refer the rule 3 of the Companies (Incorporation) Rules, 2014, which provides that only a natural person who is an Indian citizen and resident in
See lessIndia is eligible to incorporate OPC. Therefore, the question of
any “body corporate” or other organizations can not constitute a One person company. Naturally, they are not a natural person.
Is section 135 relating to Corporate Social Responsibility applicable to OPCs?
Hi, Section 135 of Companies Act is applicable to every company which is having : • net worth of Rs 500 crore or more; or • turnover of Rs 1000 crore or more; or • a net profit of Rs 5 crore or more during any of the three preceding financial years. The word used here is ’every company’, However, iRead more
Hi,
Section 135 of Companies Act is applicable to every company which is having :
• net worth of Rs 500 crore or more; or
• turnover of Rs 1000 crore or more; or
• a net profit of Rs 5 crore or more
during any of the three preceding financial years.
The word used here is ’every company’, However, in terms of rule 6(2) of companies (Incorporation) Rules, 2014, an OPC loses its status if paid-up capital exceeds Rs. 50 lakhs or average annual turnover is more than 2 crores in three immediate preceding consecutive years.
In view of this, it is quite clear that an OPC would not meet the criteria specified in section 135 as detailed above.
See lessWhat is the requirement as to the minimum and maximum number of directors in an OPC ?
Hi, Please refer to section 149(1) of the Company Act,2013, according to which: A One Person Company needs to have a Board of Directors consisting of individuals as directors and shall have a minimum of one director. It can have directors up to a maximum of 15 which can also be increased by passingRead more
Hi,
Please refer to section 149(1) of the Company Act,2013, according to which:
A One Person Company needs to have a Board of Directors consisting of individuals as directors and shall have a minimum of one director. It can have directors up to a
See lessmaximum of 15 which can also be increased by passing a special resolution as in case of any other company.
is interest paid on personal loan eligible for 24(b) of income tax act?
Section 24(b) of the Income Tax Act allowed the deduction of Interest paid on money borrowed for the purpose of purchase, repairs, renovation, etc. of house. However, it is not necessary that the money should have been borrowed as a home loan or from any banking institution. Interest paid to your fRead more
Section 24(b) of the Income Tax Act allowed the deduction of Interest paid on money borrowed for the purpose of purchase, repairs, renovation, etc. of house. However, it is not necessary that the money should have been borrowed as a home loan or from any banking institution.
Interest paid to your friends and relatives in respect of money borrowed for the purposes specified above can also be claimed under section 24(b).
But the actual use of the personal loan should be only for the purpose of the purchase, repairs, renovation, etc. To prove this, the personal loan should be taken through a bank account and the expenditures made for the above purpose and payment of interest should also be made from the bank account.
See less