Section 194R - Deduction of tax on benefit or perquisite in respect of business or profession

Payer must deduct 10% tax under Section 194R on business-related benefits or perquisites before providing them to resident

A payer who provides a resident any benefit or perquisite arising from business or profession must deduct tax at 10% on the value before providing it. If the benefit is wholly in kind or partly cash and the cash portion is insufficient to cover the tax, the payer must ensure tax is paid before release. The provision does not apply where the aggregate value to a resident in a financial year does not exceed ?20,000, or where the payer is an individual or HUF with turnover below statutory thresholds. The tax authority may issue binding guidelines, and 'person responsible for providing' includes the provider or, for a company, its principal officer.