Tds on foreign payment

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 August 2012 If a company wants to make a payment to a foreign service provider company.

Foreign service provider company is providing exhibition service to Indian company in US. where by Indian company can have a stall in US. Exhibition.

In my opinion TDS will not be applicable as service is provided outside India.

whether a Chartered Accountant can issue a form 15 CB stating NO TDS applicable in this case in point no 16 of form 15 CB.

NOte : Please reply only if you are sure about it.

CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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16 August 2012 If the Income of the non resident is business profit for him/her then As per Article 7 of the double tax avoidance agreement with USA, the Income is not chargeable to tax in India.
Accordingly, TDS is applicable on such payment.

Querist : Anonymous

Querist : Anonymous (Querist)

16 August 2012 hi AMIT,

As you said as per article 7 if it is business profit then it is not chargeable to tax.

but in last line you again said TDS applicable why it is so?

In my case it is a business income to the foreign party.

so what is your final opinion?

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CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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16 August 2012 Sorry, TDS is not applicable.
Typographical mistake.. thanks

Querist : Anonymous

Querist : Anonymous (Querist)

16 August 2012 Hi amit,

I read article 7, you are absolutely right.

thanks for your reply.

Can i ask one more related query : in form 15 CB whether it will covered under point no 13 or 14 or 16.

CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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16 August 2012 It will fit under point no. 14

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CA CS Amit S. Kedia

CA CS Amit S. Kedia (Expert)
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16 August 2012 Pls also check, Either there is no PE of Non Resident or the income is not pertaining to PE in india.
Thanks

Querist : Anonymous

Querist : Anonymous (Querist)

16 August 2012 Ya already checked that concerned party has no PE in India.

bye keep in touch... i have sent my personal details in comment.

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CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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01 October 2012 Here the TRC(Tax Residency Certificate ) from the Foreign Vendor needs to be obtained before issuing the Form 15CB.

Anuj
femaquery@gmail.com