TDS on Royalty Earned by a US Citizen in India

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Gireesh (Querist)
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14 July 2011 Hi I would like to know what is the TDS rate for royalty income earned by a US Citizen from india.
..is there any ceiling...like if Royalty income is less than a prescribed limit, then no tds..anything like that ? Also, the US Citizen (the recepient of income) should file the income tax return ? can he get a PAN in india ?

Please help

Ravikant

Ravikant (Expert)
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14 July 2011 195(g)

Royalty (not being royalty of the nature referred to in (e) sub para) payable by Government or an Indian concern in pursuance of an agreement made by non-resident with the Government or the Indian concern and where such agreement is with an Indian concern, the agreement is approved by the Central Government or where it relates to matter included in the industrial policy, the agreement is in accordance with that policy

1.Where the agreement is made after March 31, 1961 but before April 1, 1976

COMPANY 50%
OTHERS 30%

2.Where the agreement is made after March 31, 1976 but before June 1, 1997 : 30 % for all

3.Where the agreement is made after May 31, 1997 but before June 1, 1997: 20% for all

4.Where the agreement is made on or after June 1, 2005 : 10% for all

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Gireesh

Gireesh (Querist)
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14 July 2011 Thanks Ravi. I believe the agreement is made after 01/06/2005. So the rate of TDS will be 10% if i am not wrong. PLease confirm.

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Ravikant

Ravikant (Expert)
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14 July 2011 Yes, it is correct

Gireesh

Gireesh (Querist)
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14 July 2011 Hi Ravikanth..One more doubt..is there any ceiling...like if Royalty income is less than a prescribed limit, then no tds..anything like that ? Also, the US Citizen (the recepient of income) should file the income tax return ? can he get a PAN in india ?

Gireesh

Gireesh (Querist)
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Ravikant

Ravikant (Expert)
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15 July 2011 There is no ceiling,
US citizen can file return in India, He can apply for PAN and will get it,

Gireesh

Gireesh (Querist)
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15 July 2011 Dear Sir, I am still confused...Can i discuss this with you ? can i have your number of you don't mind ?

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CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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17 July 2011 Kindly explain for what purpose the US Citizen is getting royalty in India.

Also the rate shall be 10.51% if the US Citizen has PAN otherwise 20%.

Anuj
+91-9810106211

srinivasan

srinivasan (Expert)
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19 July 2011 I agree with Mr.AnujGupta. Once the TDS is applicable for a said transaction and their is no PAN available for the non-resident then the provisions of Sec.206AA would be trigered and the withholding tax rate would be @ 20% or the rate determined u/s 195 or DTAA which ever is higher.