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Scope & Coverage of TDS on Benefits or Perquisites u/s 194R

In the Finance Act 2022, a new TDS section 194R, has been inserted in the Income Tax Act, and which has been made applicable w.e.f. 1.7.2022.

This new TDS section 194R requires deduction of tax at source @ 10%, by any person, including a company, providing any benefit or perquisite, whether convertible into money or not, exceeding Rs. 20,000 in value in a year, to a resident, arising from the carrying out of any business or exercise of any profession by such resident recipient.

The provisions of this section shall not apply if the benefit or perquisite provider is an individual or a Hindu undivided family,.