TDS Query FOR FUEL RECOVERY

[VIPIN GARG]

If any company is recovering the fuel charges from the contractor, whether the company is liable to deduct the tds on that amount also, pls give the advise with the appropriate explanation.

Please ignore about that tds is not deductible on transporter.

The issue is urgent, plsssssss reply at the earliest.

Regards

CA VIPIN GARG

[Surender Gupta]

It is settled issue that there is no TDS liability on re-imbursement of expenses. What constitute reimbursement is a matter of fact. Whether recovery of fuel charges is reimbursement of expenses or not is to be ascertained from the terms and scope of contract only.

AI Summary

TDS on Reimbursement: recovery of fuel charges is not subject to deduction if treated as reimbursement under contract. A company is not liable to deduct TDS on amounts recovered as a genuine reimbursement of expenses; whether fuel charges constitute such a reimbursement must be determined from the terms and scope of the contract, as characterisation is a question of fact.