DEPOSIT OF TDS & SERVICE TAX

[S.C. WADHWA]

An individual advocate furnished one bill as below:
Towards professional Exp.			200000
Towards Out of Pocket Exp.			15000
Total			215000
Please clarify on which amount tds to be deducted u/s 194J
either be Rs. 200000/- or Rs. 215000/-
Please also clarify on what amount service tax will be deposited
and at what rate by receipient of services as receipient is company.

[CA SOHRABH JINDAL]

If the reimbursement of exps. has been claimed in same bill and on ad hoc basis i.e.without having any actual bill of reimbursement, then TDS should be deducted on ₹ 215000/-

Service tax should be on 215000/- @ 100% on reverse charge.

AI Summary

TDS on professional fees must include reimbursed expenses when billed together; service tax payable on full billed amount under reverse charge. If a professional invoices fees together with ad hoc reimbursed expenses without actual supporting bills, TDS on professional services must be deducted on the entire billed amount, and where the recipient is a company the service tax is payable by the recipient under the reverse charge mechanism on the full billed amount including reimbursements.