Treatise of section 194R under Income Tax Act,1961

What is the threshold limit of benefit/perquisite for applicability of section 194R?

• >=20000

• >20000

• >=40000

• >40000

What is the effective date of applicability of section 194R?

• 1 April 2022

• 1 July 2022

• 1 Oct 2022

• 1 June 2022

Which of the following is covered as perquisite/ benefit u/s 194R of the Act?

• When a person gives incentives (other than discount, rebate) in the form of cash or kind such as car, TV, computers, gold coin, mobile phone etc.

• When a person sponsors a trip for the recipient and his/her relatives upon achieving certain targets

• When a person provides free ticket for an event

• All of the above

Whether TDS is required to be deducted on Bonus and Right Shares?

• Yes

• No

 Which of the following is considered as a benefit/perquisite for purpose of TDS deduction requirement u/s 194R?

• Sales Discount

• Cash Discount

• Free Samples

• Rebates

Whether TDS is required to be deducted if the benefit/perquisite is a Capital Asset?

• Yes

• No

Whether reimbursement of expenses will attract the provision under Section 194R as per the Circular?

• Yes

• No

If the perquisite is in wholly in kind, then how TDS is deducted?

• the benefit provider may deduct the tax under section 194R of the Act and pay to the government by considering TDS also as benefit u/s 194R

• Such recipient would pay tax in the form of advance tax

• the benefit provider may deduct the tax under section 194R of the Act and pay to the Government and then it has to be recovered from recipient.

• All of the above

 Method of valuation of perquisite/ benefit u/s 194R if company is the manufacturer of item given as benefit/perquisite:

• fair market value of the benefit or perquisite

• purchase price of benefit/ value

• price it charges to its customers for such items

• None

In case benefits/perquisites may be used by owner/director/employee of the recipient entity or their relatives, tax is required to be deducted in name of:

• name of recipient entity

•  such owner/director/employee of the recipient entity

• Both

• None