From July 1, Tax Deducted at Source (TDS) on benefits received from business for sales promotion will be applicable to social media influencers and doctors. The Central Board of Direct Taxes (CBDT) has released guidelines on the applicability of the new provision.

Read here for new debit card rules from July 1, 2022.

The Union Budget had brought in the provision of TDS on such income to check tax revenue leakage by inserting a new section, 194R, in the Income Tax Act, 1961.

It requires TDS at 10 per cent for any person providing benefit exceeding ₹ 20,000 in a year to a resident.

What comes under benefits and perquisite?

Kamlesh C Varshney, Joint Secretary in the Finance Ministry, had explained the benefits, which he said include free medicine samples received by doctors, foreign flight tickets or free Indian premier League (IPL) tickets in the course of business and more.

Mr Varshney emphasised that these should be disclosed while filing the income tax return, adding that it shouldn’t be avoided based on the fact these items are not being sold.