Withholding Tax and RCM
This query is : Resolved
27 December 2021
Dear Experts,
Let us explain to you that, our two entity (India and Singapore) Company has bid through Joint Venture. We get the project through joint venture. Both the companies work in the same project, but the client will pay only one of them. We issue invoices from India, as there is DTAA in India and client country. My question is how will we pay to Singapore company, as both are working in client place. Can anyone explain the procedure, how we can do payment/fund transfer (certain %) from India to Singapore.
Let us explain to you that, our two entity (India and Singapore) Company has bid through Joint Venture. We get the project through joint venture. Both the companies work in the same project, but the client will pay only one of them. We issue invoices from India, as there is DTAA in India and client country. My question is how will we pay to Singapore company, as both are working in client place. Can anyone explain the procedure, how we can do payment/fund transfer (certain %) from India to Singapore.
27 December 2021
Have an agreement with Singapore company for execution of joint works and receive payment from Indian company.
Based on the agreement ask the Singapore company to raise invoice and take payment from Indian company.
Based on the agreement ask the Singapore company to raise invoice and take payment from Indian company.
27 December 2021
Witholding tax and RCM not applicable as the work executed by Singapore company outside India.
27 December 2021
Thank you very much Mr. Sitaraman, we need in-depth knowledge about the agreement (Joint Venture) between Singapore and India. Then if Singapore issue invoice to India, then how to treat with Indian company of this invoice, means which expenses head , how to transfer funds from India to Singapore, on what basis we do not deduct withholding tax and RCM? please explain or share your contact number or email id. Thanx
27 December 2021
It's not an expense debit the foreign receipt kept under liability (take portion related to your receipt as income balance keep it as liability payable to joint venture partner)
Alternatively you can open a bank account in foreign country and pay to Singapore company from there it's permitted.
Alternatively you can open a bank account in foreign country and pay to Singapore company from there it's permitted.
27 December 2021
rseeraman@gmail.com
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28 December 2021
Ok Mr. Sitharaman sir, thanks for the suggestion. How can we transfer funds from India to Singapore. We have only one office in India, we do not have any branch/office outside India, so how can I open a foreign account in another country? We need a brief description about it.
How can we book if payment is received from client against invoice in india, we will give a certain share as joint venture for Singapore company. The client deducted our withholding tax and given it to the company in India, can we claim 100% withholding tax benefit in India as a joint venture project. ?
How can we book if payment is received from client against invoice in india, we will give a certain share as joint venture for Singapore company. The client deducted our withholding tax and given it to the company in India, can we claim 100% withholding tax benefit in India as a joint venture project. ?
28 December 2021
You execute work outside India so you can open bank account outside India in that country, no need for branch office.
Pay to Singapore from that account.
You can't claim 100% witholding tax as you are sharing some income with your joint venture partner.
,
Pay to Singapore from that account.
You can't claim 100% witholding tax as you are sharing some income with your joint venture partner.
,
27 January 2022
Dear mr. Seetharaman Sir/ other experts,
In the same question in conti....
Can we claim remaining WHT expenses in India, which we will transfer (part of) to Singapore company which is our entity and joint venture in all projects. Or will we disallowed this expenses in india ?
In the same question in conti....
Can we claim remaining WHT expenses in India, which we will transfer (part of) to Singapore company which is our entity and joint venture in all projects. Or will we disallowed this expenses in india ?
27 January 2022
Claim payment to Singapore company as your expenses.
29 January 2022
Dear Mr. Sitaraman Sir/other experts,
Continuing with the same question… As we mentioned earlier, we have got the project of Joint Venture Agreement (India and Singapore) worth Rs.100. As per joint venture project total 100/- received in India, we have transferred Singapore to a fixed portal like 30/- to Singapore, without WHT and without RCM. Now my question is how to make a booking of 30/- in our Indian books, is it expenses for indian company, or what is this 30/- entry in India books?
Continuing with the same question… As we mentioned earlier, we have got the project of Joint Venture Agreement (India and Singapore) worth Rs.100. As per joint venture project total 100/- received in India, we have transferred Singapore to a fixed portal like 30/- to Singapore, without WHT and without RCM. Now my question is how to make a booking of 30/- in our Indian books, is it expenses for indian company, or what is this 30/- entry in India books?
29 January 2022
Yes, it's expenses as they work in the project.
29 January 2022
Client Deducted WHT and gave certificate to India company on the entire project cost.
1) Can we claim only 70% amount on WHT ( as certain portion Indian and Singapore company) ?
2) Can we claim expenses of remaining 30% of WHT amount in India company ?
1) Can we claim only 70% amount on WHT ( as certain portion Indian and Singapore company) ?
2) Can we claim expenses of remaining 30% of WHT amount in India company ?
29 January 2022
1 Claim 100% WHT as it's deducted in Indian company name.
2 Claim 30% as expenses.
2 Claim 30% as expenses.
11 February 2022
Dear All Expert/ Mr. SEETHARAMAN Sir,
We are confirming again that you continue with the above question/query. That is, our Associated Enterprises Company issued invoices for our India Company as service Invoice, which is a Joint Venture Project. Our ongoing project is outside India and we are working on both India and Singapore company in the same project. But our client gives 100% payment to India company, then we have made a joint venture agreement between Singapore and India. Then the Singapore company gives service invoice to the Indian company, but the Singapore company has not provided any service in India, they have given their services in client country. Now my question is if Singapore company gave service invoice to Indian company, then India company will deduct WHT (TDS) on this invoice? Please confirm again.
We are confirming again that you continue with the above question/query. That is, our Associated Enterprises Company issued invoices for our India Company as service Invoice, which is a Joint Venture Project. Our ongoing project is outside India and we are working on both India and Singapore company in the same project. But our client gives 100% payment to India company, then we have made a joint venture agreement between Singapore and India. Then the Singapore company gives service invoice to the Indian company, but the Singapore company has not provided any service in India, they have given their services in client country. Now my question is if Singapore company gave service invoice to Indian company, then India company will deduct WHT (TDS) on this invoice? Please confirm again.
11 February 2022
No need for WHT(TDS) as service rendered by non resident outside India not taxable in India.
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