Tax Collected at Sources (TCS) on Tour Operator

√ Do you know that Budget 2020 casted additional burden on Tour operator to collect additional Tax from the person who buys “Overseas tour program” package from Tour Operator from 01st April,2020.

√ Whether all person will be required to collect TCS or only specified person?

> Every Person who is being a seller of an overseas tour program package, who receives any amount from a buyer, shall collect tax at sources at specified rate as below:

> If a buyer furnishes his PAN then Tax would be collected at the rate of 5% and in case of Non PAN would be collected at the rate of 10%.

Tour Operator

√ Now main question comes what do you mean by “Overseas tour program package”?

> Section 206C defines the term “Overseas tour program package” means any tour package which offers visit to a country or countries or territory or territories outside India and includes expenses for travel or hotel stay or boarding or lodging or any other expenditure of similar nature or in relation thereto”

√ Is there any threshold limit for Overseas Tour Operator to collect TCS?

> No, there is no threshold limit for Overseas Tour Operator to collect TCS.

√ Is there any statement which tour operator is require to furnish to income tax like TDS Return?

> Yes, tour operator is required to furnish Quarterly TCS Returns just like TDS Returns

√ How a person will get credit of TCS collected by tour operator?

> Credit for Tax Collected at Sources (TCS) on Overseas Tour Package is duly provided to buyer as like TDS Credit.

> The buyer can claims the credit at the time of filling their income tax return.

√ Whether am I liable to collect TCS as a Tour Operator if my buyer is deducting TDS under any provision of Income Tax Act?

> No, if your buyer is deducting TDS under any provision of Income Tax then as a tour operator you are not liable to collect TCS from him.

Author Bio

Qualification: CA in Practice
Company: ATMS & CO LLP, CHARTERED ACCOUNTANTS
Location: THANE, Maharashtra, IN
Member Since: 18 Feb 2020 | Total Posts: 3

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13 Comments

  1. Sanjiv Bhatnagar says:

    Sir, I have a travel agency with no GST or PAN. Now if I buy an international tour package for my Indian client from a b2b company based in India how would TCS work for me.

  2. Anil says:

    Dear Sir ,
    I don’t have TAN & GST no as my turnover is below 20 lacs .
    In case of foreign tour how can I deposit TCS .
    Can any third party do that for me ??

    Thnx n Rgds

  3. ZAID says:

    if i am selling any service to client who is from outside INDIA then is TCS applied to them??
    and if yes then what is the rate of interest?
    and does any exemption is there?

  4. kiran damle says:

    If a travel agency A is buying from another travel agency B (b2b supplier) and Travel Agency A Is already dedcuting TDS 2% for amount excluding GST , in that case will Travel Agency B(b2b supplier) still need to collect 5% TCS or Not ? please advise,. Appreciat your reply

  5. Ankit Bajaj says:

    Humble request to please educate more precisely on “Whether am I liable to collect TCS as a Tour Operator if my buyer is deducting TDS under any provision of Income Tax Act?”
    I have studied your example, but still seeking more clarity. If an individual purchasing international package asks the Travel Agency to raise an invoice to the clients firm and they make a payment after deducting TDS then they would not be liable to pay any TCS?? Request to please educate. Ankit Bajaj – 9327761991

  6. syed says:

    Sir Please Explain that ,If a someone is a HAJ TOURS OPERATOR in India which operates only one Tour a Year(i.e HAJ TOUR) for going to Saudi Arabia. Do TCS also applicable on Pilgrimage Tours to Saudi Arabia, Kailash Maan Sarovar as these tours are regarded as Religious Pilgrimage Tour outside India.

  7. Preeti Vardhan says:

    Please explain with example that, if your buyer is deducting TDS under any provision of Income Tax then as a tour operator you are not liable to collect TCS from him.

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