Pure Agent - TDS deposit and return

[JOHN SHANNEL]

Pure agent pays rental on behalf of me.

can you clarify who is responsible for depositing TDS and file TDS return? pure agent or Principal (me)

[KASTURI SETHI]

DEAR SH. JOHN SHANNEL,

I am not expert in the field of Income Tax. You need to peruse the definition of pure agent. After reading the definition, you will be able to arrive at decision yourself.

Rule 33 of CGST Rules, 2017, “pure agent” means a person who -

(a) enters into a contractual agreement (whether written on otherwise) with the recipient of supply to act as his pure agent to incur expenditure or costs in the course of supply of goods or services or both;

(b) neither intends to hold nor holds any title to the goods or services or both so procured or provided as pure agent of the recipient of supply;

(c) does not use for his own interest such goods or services so procured; and

(d) receives only the actual amount incurred to procure such goods or services.

Examples of pure agent are : Travel Agent, C & F Agent, CHA etc.

AI Summary

Pure agent status determines who must deposit TDS on payments made on another's behalf for tax compliance. The allocation of TDS deposit and return filing depends on characterization as a pure agent: a contractual agent who incurs expenditure on behalf of the recipient, does not hold title or use the procured goods or services for personal benefit, and is reimbursed only for actual amounts incurred. Examples include travel agents, C&F agents, and customs house agents. The adviser declined to give a direct tax ruling and instead advised applying the statutory definition to determine whether the agent or the principal bears TDS obligations.