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TDS u/s 195 for website development

29 August 2021

Person A is paying 1.5lacs to a Non resident for development of website. Turnover of A is around 20 lakhs for the previous year. Is he still liable to deduct TDS u/s 195?

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v devanathan (Partner of a CA Firm) (132 Points)
Replied 29 August 2021

The given payment is for development of website and thus may said to be fees for technical services. Since it is paid to non-resident, it is falling under Sec.195, where the liability is on all payers and it is not linked to any criteria such as TO. Hence, Person is liable to deduct TDS u/s. 195.

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CA. Sourav Sarkar (Chartered Accountant ) (24583 Points)
Replied 29 August 2021

Yes TDS should be deducted u/s 195

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SAURABH GHAI (.) (58 Points)
Replied 11 January 2023

What if NR don't have any business connection in India, would payer still be required to deduct TDS? Isn't it business profit as per DTAA, which should be taxable in country of NR.