Tds u/s 195

This query is : Resolved

Vijay Kumar (Querist)
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04 May 2012 Dear Sir,

Could you please clarify the following queries:

1. Can we deduct TDS@20% u/s 195 on the freight charges charged ag. Invoice/Debit Note by the Foreign Company and pay the net amout.

or

2. Shall we Gross up the TAX component for the Freight charges and pay the same amount what is stated in the Invoice/Debit Note by the Foreign Company instead of deducting the TAX.

If there is any case-law regarding this please provide it.

Please advise.

Thanks & regards,

Vijay Kumar

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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06 May 2012 That depends on the agreement between the two parties ,normally the first route is adopted as the foreign party can get claim of tax deducted in India.

Vijay Kumar

Vijay Kumar (Querist)
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07 May 2012 Dear Sir,

Thank You very much for your advice.

Could you kindly let me know how the Foreign Company shall claim the TAX deducted by us.

Thanks & regards.

Vijay Kumar

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CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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07 May 2012 under the provisions of Tax credit mechanism of DTAA that India has signed with that country.

Anuj

Vijay Kumar

Vijay Kumar (Querist)
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08 May 2012 Thank You Sir.