Dear All,
We are a software company. Also, we are running a training institute. The trainee students from the institute are working with the company as trainee consultants. These trainees are drawing a stipend. I would like to know whether the stipend paid to trainees is free from income tax deductions at the source. To have more clarity, I hereby add that the fees paid by the students are properly covered under GST as AICTE approval is not there for the courses.
Is the stipend concept correct, and if it is correct, up to what amount can it be made?
Thank you.
From India, Pune
Acknowledge(0)
Amend(0)
73We are a software company. Also, we are running a training institute. The trainee students from the institute are working with the company as trainee consultants. These trainees are drawing a stipend. I would like to know whether the stipend paid to trainees is free from income tax deductions at the source. To have more clarity, I hereby add that the fees paid by the students are properly covered under GST as AICTE approval is not there for the courses.
Is the stipend concept correct, and if it is correct, up to what amount can it be made?
Thank you.
From India, Pune
Acknowledge(0)Amend(0)
Dear Ramakant,
The treatment of stipend received by trainees or students as "income" under the Income Tax Act, with the exception of medical students pursuing higher studies, remains a debatable issue. By the way, do the stipends paid to such trainee consultants exceed Rs. 250,000 per annum?
Thank you.
From India, Salem
Acknowledge(0)Amend(0)
The treatment of stipend received by trainees or students as "income" under the Income Tax Act, with the exception of medical students pursuing higher studies, remains a debatable issue. By the way, do the stipends paid to such trainee consultants exceed Rs. 250,000 per annum?
Thank you.
From India, Salem
Acknowledge(0)Amend(0)
Dear Mr.Umakanthan M. Thanks for your immediate response. The stipend will be for three months @ Rs.8,000 per month. Ramakant
From India, Pune
Acknowledge(0)Amend(0)
From India, Pune
Acknowledge(0)Amend(0)
Dear Ramakant,
Since the annual remuneration exceeds Rs 30,000, the disbursement of stipend attracts "Tax Deduction at Source" (TDS) @ 10% under section 194J of the IT Act, 1961. In fact, your accounts department should have educated you on this.
Thanks,
Dinesh Divekar
From India, Bangalore
Acknowledge(0)Amend(0)
Since the annual remuneration exceeds Rs 30,000, the disbursement of stipend attracts "Tax Deduction at Source" (TDS) @ 10% under section 194J of the IT Act, 1961. In fact, your accounts department should have educated you on this.
Thanks,
Dinesh Divekar
From India, Bangalore
Acknowledge(0)Amend(0)Engage with peers to discuss and resolve work and business challenges collaboratively. Our AI-powered platform, features real-time fact-checking, peer reviews, and an extensive historical knowledge base. - Register and Log In.
Stipend to be paid through bank account from 1.11.2016.pdf