TDS - PAYMENT TO NON-RESIDENT

krishna iyer (Sr.Finance Manager) (197 Points)

03 March 2009  

Dear Sirs,

A foreign professor is conducting a training for us.   He is a non-resident (SWISS)

He wants Rs.1 lakhs net.  ie. we have to bear all  W/H taxes.  

Now a foreigner can take rupee payments (in cheque) and credit to his account, I believe..

Since the payment is to a non-resident,  W/H tax u/s 195 is applicable, I presume.  

my specific query is can S 195 be applied on rupee payments.  Since payments has to be net of tax,  we will hav e to gross up the payment and bear tax .

tax rate to be applied is for professional services.

 

 

 

 

regards