TAX LIABILITY ON PERQUISITES OR BENIFITS RECEIVED FROM SUPPLIER.

[BARUN MUKHERJEE]

Respected Experts,

A taxpayer is a reseller of mobile sets and received benefits from suppliers on which TDS has been deducted u/s 194R of Income Tax Act and reflecting under 26AS and credited the amount in his Profit & Loss Account. This is also to be noted that maximum of that amount was distributed to his debtors and the amount was debited in his Profit & Loss Account. Is there any tax liability under GST on above scenario..???

AI Summary

Mobile Phone Reseller Navigates Tax Complexities of Performance Incentives Under Section 194R Requiring Strategic GST Compliance A mobile phone reseller received performance-based benefits from a supplier, with TDS deducted under section 194R. The key issue is potential GST liability on these incentives. While the benefits were largely distributed to buyers, GST may still apply if the amount is considered a service provided to the supplier. The recommendation is to either route the transaction through a credit note or raise a proper invoice and pay GST on the received benefits.