Clause 58 - Insertion of new section 194R-Deduction of tax on benefit of perquisite in respect of business or profession - Finance Bill, 2022

Insertion of new section 194R. 58. After section 194Q of the Income-tax Act, the following section 1 shall be inserted with effect from 1 st day of July, 2022, namely: Deduction of tax on benefit of perquisite in respect of business or profession. 194R. Any person responsible for providing to a resident, any benefit or perquisite, whether convertible into money or not, arising from business or the exercise of a profession, by such resident, shall, before providing such benefit or perquisite, as the case may be, to such resident, ensure that tax has been deducted in respect of such benefit or perquisite at the rate of ten per cent. of the value or aggregate of value of such benefit or perquisite: Provided that in a case where the benefit or perquisite, as the case may be, 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 person responsible for providing such benefit or perquisite shall, before releasing the benefit or perquisite, ensure that tax has been paid in respect of the benefit or perquisite: Provided further that the provisions of this section shall not apply in case of a resident where the value or aggregate of value of the benefit or perquisite provided or likely to be provided to such resident during the financial year does not exceed twenty thousand rupees: Provided also that the provisions of this section shall not apply to a person 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, as the case may be, is provided by such person. Explanation. For the purposes of this section, the expression person responsible for providing means the person providing such benefit or perquisite, or in case of a company, the company itself including the principal officer thereof. . ----------------------- Notes 1. See the Corrigendum Errata Finance Bill, 2022