Expansion of TCS under Income Tax- TCS on Sales of Goods

Expansion of TCS (Tax Collected at Source) Compliance under Income Tax. 

Eligibility: – Sale of any goods above INR 50 Lacs; and Turnover of INR 10 Crore and above during FY 2019-20.

Law: – It is proposed to levy TCS on sale of goods as per section 206C (IT Act) at the rate of 0.1% on consideration received from buyer in excess of INR 50 Lacs in a Financial Year. However such provision would apply only if total sales, gross receipts or turnover of seller from the business carried on by it exceeds INR 10 Crore during the immediately preceding the FY. Further, In case PAN or Adhaar is not provided by the buyer, the tax would be collected at 1% instead of 0.1% by the seller.

Exceptions: – The above provision would not apply where

• the buyer is liable to deduct TDS under any other provisions of the Act like Alcoholic Liquor for Human Consumption, Scrap, Minerals etc. and has deducted such amount; or
• the buyer is the Central/State Govt., an embassy, a High Commission, Legation, Consulate, the trade representative of foreign state, local authority; or
• any class of person notified by the Central Govt. in the official gazette for the purpose subjects to such condition as specified in that notification.

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