section 195 articles

TDS liability on payment to non-residents which is exempt under DTAA

TDS liability on payment to non-residents which is exempt under DTAA The Supreme Court in its recent judgment in the case of  PILCOM vs CIT in SLP (CIVIL) No.7315 of 2019  has created a controversy on the withholding tax provision on the payment to be made to Non-resident. The recent judgement of Supreme Court has […]...

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Posted Under: Income Tax |

Payment Made To Non-Residents In Their Indian Bank Accounts & Form 15CA/15CB

The matter of whether Form 15CB is required for making payments to the Indian Bank account of a non-resident / foreign company is a grey area in the Income-tax law. Various entities have not been filing Form 15CA / 15CB while making payments to Indian Bank account of non-residents / foreign companies, since paying bank does not insist on ...

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Posted Under: Income Tax |

Basics of Section 195 of Income Tax Act, 1961

To Whom does Section 195 applies? a) A resident Making Payment to Non-Resident and, b) A Non-Resident making payment to a Non-resident. As per Section 195, it says Any person responsible for paying to non-resident…any person not only includes Resident but also non-resident making payment to a non-resident...

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TDS implication on purchase of property from NRI

It is essential to note that in case of purchase of property, the buyer is responsible for deducting the applicable tax at source (i.e. TDS) and deposit the same with the Government. Since the buyer is required to deduct the TDS, he would obviously be required to fulfil all the relevant compliance like TDS payment; […]...

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Interesting Cases for TDS u/s 195 – Foreign Remittance from India

Withholding taxes u/s 195 in respect of transactions with Non-Residents has always been a bone of contention between Assessee and tax authorities. Though liability for deduction of TDS is clear in respect of some transactions like royalties, fees for technical services, interest etc., ...

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Foreign Remittance: TDS u/s 195: Reimbursement of Expenses

Taxability of Reimbursement of expenses has always been a contentious issue. In most of the cases, assessee gets away with non-taxability of reimbursement of expenses on the plea of no profit element. However, in some cases, even without profit element, tax authorities and courts have held reimbursement of expenses as income of recipient ...

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TDS on sale of Immovable Property by Non-resident

Recently I was asked a question by someone that at what rate TDS is to be deducted at the time of purchasing a property in India from a non-resident. The answer to the question lies in the simple reading of the Income Tax Act’1961. Let us examine the relevant Sections of the Income Tax Act’1961. […]...

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PILCOM – A bitter pill which would hurt commerce?

A recent judgment of the Supreme Court in the case of PILCOM v. CIT is likely to create significant confusion if not examined from proper perspective. On a first blush it seeks to unsettle a settled law, viz. a person is not liable to deduct tax at source in relation to payment made to a non resident which is, in the hands of the payee, n...

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Posted Under: Income Tax |

TDS Provisions related to Small Businesses & Covid 19 Relief

TAX DEDUCTION AT SOURCE (TDS) In order to ensure better tax compliance and ensuring the timely payment of tax to the Government treasury, a mechanism has been established by making it mandatory for certain persons responsible for making payment of some expenses to deduct tax from such payment and deposit it to the Government account. [&he...

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Posted Under: Income Tax |

TDS on legal service received from outside India

Legal fees is deemed to accrue or arise in India, whether or not non-resident has place of business in india or has rendered services in India. ...

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Posted Under: Income Tax |

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