Tds on foreign agents
This query is : Resolved
28 November 2011
According to section 195 of Income Tax Act, TDS has to be deducted at 30% on services by foreign agents.
Under this situation we have three solutions:
1. Under section 195 (5), the assessing officer has the power to exempt or reduce the TDS on foreign agents.
2. Under DTAA (Double Taxation Avoidance Agreement), the rates for TDS can be reduced as per the DTA rates.
3. Procedures can be undertaken to register the foreign agent as subject to Indian Income Tax and then he will have to follow all the procedures usually followed by any assessee in India.
Apart from the above, there is a circular which states that if the agent is non resident and works from a foreign soil, no part of his income arises in India. So no TDS has to be deducted under section 195. (Circular no.786 dated 07.02.2000).
Above mentioned is my opinion for TDS on foreign agents. Is it true or needs any rectification?
Under this situation we have three solutions:
1. Under section 195 (5), the assessing officer has the power to exempt or reduce the TDS on foreign agents.
2. Under DTAA (Double Taxation Avoidance Agreement), the rates for TDS can be reduced as per the DTA rates.
3. Procedures can be undertaken to register the foreign agent as subject to Indian Income Tax and then he will have to follow all the procedures usually followed by any assessee in India.
Apart from the above, there is a circular which states that if the agent is non resident and works from a foreign soil, no part of his income arises in India. So no TDS has to be deducted under section 195. (Circular no.786 dated 07.02.2000).
Above mentioned is my opinion for TDS on foreign agents. Is it true or needs any rectification?
05 December 2011
The whole opinion is going in different directions ,without coming to any definite conclusion.
The answer for "whether TDS needs to be deducted for payment of commission to foreign agent "is NO in terms of SC ruling in Toshuku Ltd.
Anuj
+91-9810106211
femaquery@gmail.com
The answer for "whether TDS needs to be deducted for payment of commission to foreign agent "is NO in terms of SC ruling in Toshuku Ltd.
Anuj
+91-9810106211
femaquery@gmail.com
Message likes :
1 times
06 December 2011
Well that was an excellent suggestion. Now I have got the print out of the case as a reference with me.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- ITC temporary reversal and reclaim
- Applicable TDS rate for sale of property in Nov 2024
- Inventory of finished goods
- Tds on building rent monthly
- Quiery in relation to GST liability in case of an advocate who has obtained GST registration.
- Confusion around Form 26QB fields
- Can we claim ITC of Feb-2024 in the month of November-2024 which was not claimed by oversight
- Sale of property furniture sale
- REGARDING 25 AS DATE OF PAYMENT AND DATE OF BOOKING
- Clarification on Documentation of Paid-Up Capital Contribution by Directors
- TDS under section and rate of TDS
- GST input on scooter purchased
- TDS under section 194Q and TCS under section 206C
- GST input on car insurance and repairs
- GST input on Diwali gift to employee
- GST input on Mobile Handset
- Material and freight in same invoice
- TDS under section 194J inclusive of reimbursement of expenses
- TDS on Material and Labour in same invoice
Trending Online Classes
CAclubindia
