What is TCS?

The full form of the TCS is Tax Collected at Source. TCS is generally collected by the seller from the buyer at the time of sale and then he will remit that amount to the government. Section 206C of the Income Tax Act, 1961 is the governing section of the TCS. There are specific types of goods on which TCS is applicable. Some of the examples are as under:

  • Alcoholic liquor for human consumption
  • Tendu leaves
  • Timber obtained under a forest lease
  • Timber obtained by any mode other than under a forest lease
  • Any other forest produce not being timber or tendu leaves
  • Scrap
  • Parking lot
  • Toll plaza
  • Mining and quarrying

Normally, the TCS on the above mentioned goods are vary from 1% to 5%. Sometimes, in non-PAN/ Aadhaar cases the rate shall be extend upto ten per cent.

The due date for deposit of TCS amount is seventh day of the following month.

Further, tax collector has to filed quarterly return for TCS in Form 27EQ. The due dates for Q1, Q2, Q3 and Q4 are 15th July, 15th October, 15th January and 15th May respectively.

[Note: Please note that due to COVID-19, the due date for Q1 and Q2 of FY 2020-21 has been extended upto 31st March, 2021.]

Also, after filing quarterly TCS return tax collector is responsible for providing TCS certificate to the purchaser. TCS certificate is in Form 27D. It should be issued within 15 days from the date of filing TCS return.

TCS Rate Chart For Assessment year 2021-22

Section Particulars TCS Rates (in %) (Upto 13th May, 2020) TCS Rates (in %) (From 14th May, 2020 to 31st March, 2021)
206C(1) Sale of the following:
a) Alcoholic Liquor for Human Consumption 1% 1% (No Change)
b) Tendu leaves 5% 3.75%
c) Timber obtained under a forest lease 2.5% 1.875%
d) Timber obtained by any mode other than under a forest lease 2.5% 1.875%
e) Any other forest produce not being timber or tendu leaves 2.5% 1.875%
f) Scrap 1% 0.75%
g) Minerals, being coal or lignite or iron ore 1% 0.75%
206C(1C) Grant of lease or license of the following:
a) Parking lot 2% 1.5%
b) Toll Plaza 2% 1.5%
c) Mining and quarrying (Other than mining and quarrying of mineral oil, petroleum and natural gas) 2% 1.5%
206C(1F) Sale of the motor vehicle of the value exceeding Rs. 10 lakh whether payment is received by cheque or by any other mode 1% 0.75%
206C(1G)(a) TCS on foreign remittance through Liberalised Remittance Scheme (LRS)

(This Section is inserted by Finance Act, 2020 which is proposed to be applicable from 01/10/2020)

0.5%: Where
remittance is a repayment of loan obtained for the
purpose of
pursuing any
education.5% In any other
case.(w.e.f. 01.10.2020)

(10% for non PAN or Aadhaar cases)

(W.e.f. 01/10/2020)

0.5%: Where
remittance is a repayment of loan obtained for the
purpose of
pursuing any
education.5% In any other
case.(w.e.f. 01.10.2020)

(10% for non PAN or Aadhaar cases)

(W.e.f. 01/10/2020)

206C(1G)(b) TCS on selling of overseas tour package

(This Section is inserted by Finance Act, 2020 which is proposed to be applicable from 01/10/2020)

5%

(10% for non PAN or Aadhaar cases)

(W.e.f. 01/10/2020)

5%

(10% for non PAN or Aadhaar cases)

(W.e.f. 01/10/2020)

206C(1H) TCS on sale of any goods [except goods on which TCS applicable as per Section 206C (1), 206C (1F) and 206C (1G)]

(This Section is inserted by Finance Act, 2020 which is proposed to be applicable from 01/10/2020)

0.10%

(1% for non PAN or Aadhaar cases)

(W.e.f. 01/10/2020)

0.075%

(1% for non PAN or Aadhaar cases)

(W.e.f. 01/10/2020)

*****

Disclaimer: The contents of this article are for information purposes only and does not constitute advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer to relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc before acting on the basis of the above write up.  The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that Author / TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

(Republished with Amendments by Team Taxguru)

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5 Comments

  1. CA.Dheeran says:

    We are selling scrap to end user i.e. manufacturer & not collecting TCS. Manufacturer Submit Form 27 C. My question is whether this form is to be submitted Once in a year or needs to be submmitted vehicle wise. I am of the opinion that Form 27 C needs to be submitted vehicle wise because the seller has to submit this form on a month to month basis to CIT. In case of different view please share with supporting.

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