The Hindu Business Line : Need to reduce TDS rates

I quite see your point. In fact, this anomaly may be well reflected in huge refund claims, especially from middle-level professionals and middle-class income earners subjected to TDS. The TDS rate on professional income, for example, in terms of Section 194J is 10 per cent. This is too high now that the first slab rate of 10 per cent is going to be on income up to Rs 3 lakh.

ACCOMMODATION AT SITE

Our company has not paid any HRA at site through voucher payment or through pay-slip for some of the employees but our company has constructed temporary sheds at site and given them to such employees whose families live at the site.

We are not considering the value of accommodation while computing the tax liability of the employee. Please clarify the tax implications on such accommodation provided by the employer at site under I-T Act, 1961 and FBT implication on such maintenance of temporary sheds.

Kiran, Guntur

If the temporary sheds are located at least 8 km away from the local limits of a municipality and are not more than 800 square feet in terms of plinth area, then the employees would enjoy a tax-free perquisite. It is, however, possible for the assessing officer (AO) to treat depreciation on such sheds as well as other expenses on them as lodging expenses and impose FBT.

FLIP-FLOP ON FORM 16

Last year, we did not have to attach the Form 16 to the income-tax return. This time I am told I have to. Why this flip-flop?

Mary Rodrigues, Trissur

Last year, the CBDT went overboard in anticipation of its Intranet connectivity being in place ahead of schedule which was March 31, 2008. Now there is admittedly a setback.

The Finance Bill 2008 has openly admitted this and hence postponed the need to issue and attach TDS certificates till after March 2010.

Hopefully, the Finance Minister would not be embarrassed to postpone this for the fourth time. When the Intranet system is in place, there would obviously be no need to attach TDS certificates which often come in truckloads for big ticket assessees what with the assessing officer being able to access information from any circle/region/ward.

S. MURLIDHARAN

(ASK! Send in your queries to ask@thehindu.co.in

http://MentorQA.blogspot.com)

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