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

Following are the important points for Section 194R:

1. This section introduced in Finance Act 2022.
2. This section has been applicable from 01st July 2022.
3. Any person (Resident or Non Resident) will be responsible to deduct TDS.
4. Payment include in this section are any benefit or perquisite, whether convertible into money or not.
5. The above payment shall be in course of arising from business or the exercise of a profession.
6. Payment in this section to be done to the resident only.
7. Rate of TDS will be 10%.
8. TDS shall be deducted before payment.
9. TDS shall be deducted on aggregate value.
10. Aggregate value of perquisite or benefits under this section shall be more than Twenty thousand in a Financial year
11. This section shall not apply to a person (i.e. payer) being an individual or a Hindu undivided family, whose total sales, gross receipts or turnover does not exceed one crore rupees in case of business or fifty lakh rupees in case of profession, during the financial year immediately preceding the financial year in which such benefit or perquisite provided by such person.
12. Where the benefit or perquisite, is wholly in kind or partly in cash and partly in kind but such part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of such benefit or perquisite, the payer shall, before releasing the payment, ensure that tax required to be deducted has been paid in respect of the benefit or perquisite.