TDS on payments to non residents
This query is : Resolved
25 June 2010
an indian company wants to pay commission to a non resident individual. the services are rendered oustside india. whether TDS to be deducted u.s 195
25 June 2010
Hi AL Raghunathan
As per Karnataka High Court (HC) [ITA No. 2808 of 2005] in the case of Samsung Electronics and others (Taxpayers). The HC held that any payment resulting in any income in the hands of a non-resident would be subject to withholding tax under the Indian Tax Law (ITL). Unless an order is obtained from the Tax Authority for withholding tax at a lower rate or for not withholding tax, a taxpayer would need to withhold tax on the income at the applicable withholding tax rates, even if the income may not be taxable in the hands of the non-resident.
Therefore its always a better advice to deduct TDS on payment made to NRI
As per Karnataka High Court (HC) [ITA No. 2808 of 2005] in the case of Samsung Electronics and others (Taxpayers). The HC held that any payment resulting in any income in the hands of a non-resident would be subject to withholding tax under the Indian Tax Law (ITL). Unless an order is obtained from the Tax Authority for withholding tax at a lower rate or for not withholding tax, a taxpayer would need to withhold tax on the income at the applicable withholding tax rates, even if the income may not be taxable in the hands of the non-resident.
Therefore its always a better advice to deduct TDS on payment made to NRI
25 June 2010
thanks
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