TDS on Salary

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

05 January 2011 XYZ Ltd is comapny incorporated in India carrying on business of Construction in India only. XYZ Ltd has open branch in Dubai (not for construction in dubai but for receving sales booking from Dubai in India) & emplyoed a person on salary. XYZ remmit the amount to Dubai branch & branch will pay salary to the employee in Dubai.The emplyoee is Indian Citizen but not Resident Indian.
Whether TDS will be applicable to on above salry payment?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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06 January 2011 The person is rendering services outside India. He is receiving Salary outside India. From the Income tax point of view he is NRI and is not liable to tax in respect of that income. No TDS is to be deducted.

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
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06 January 2011 TDS will not apply.

Any person responsible for p[aying any income chargeable under the head salaries is required to deduct tax at source on the amount payable.

Since Salary is not a taxble salary, TDS will not apply.

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