section 195 - Page 3

Online application to determine TDS on payment to non-residents

Online filing of application seeking a determination of tax to be deducted at source on payment to non-residents Under sub-section (2) of section 195 of the Act, if a person who is responsible for paying any sum to a non-resident which is chargeable to tax under the Act (other than salary) considers that the whole […]...

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TDS on Payments to Non Residents (Section 195)

Overview of  TDS on Non Resident Payments Provisions for Deduction of Tax at source in case of payments to non-residents is covered under section 195 of the Income tax act 1961 which are as below. SECTION 195 (1) APPLICABILITY Payments to any Non-Resident (not being a company). Foreign Company. PAYMENTS COVERED Any interest. Any other [&...

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Payment for bandwidth charge utilization was royalty & TDS applicable

CIT Vs Infosys Technologies Ltd. (Karnataka High Court)

CIT Vs Infosys Technologies Ltd. (Karnataka High Court) Payment for bandwidth charge utilization was royalty and TDS was required to be deducted under section 195 of Income Tax Act, 1961 and on failure to deduct TDS, the disallowance under section 40(a)(i) was rightly made by the Assessing Officer. FULL TEXT OF THE HIGH COURT ORDER [&hell...

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TDS u/s 195 on commission paid to overseas agents?

DCIT (OSD) Vs Jay Chemical Industries Ltd. (ITAT Ahmedabad)

Commission paid to non-resident agent was not liable to tax under the provisions of act when the services were rendered outside India, payments were made outside India and there was no permanent establishment or business connection in India, therefore, assessee was not required to deduct TDS u/s 195(2)....

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Software purchased across the counter as shrink proof software is not akin to royalty

Opus Software Solutions Pvt. Ltd. Vs ACIT (ITAT Pune)

It was held that where the software is purchased across the counter as shrink proof software, then it is not akin to royalty both under the Income Tax Act or the DTAA. The Tribunal held that since the definition of ‘royalty’ has not been amended under DTAA,...

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Usance interest for delayed payment to holding company liable to TDS

ACIT Vs M/s. Overseas Trading and Shipping Co. Pvt. Ltd. (ITAT Rajkot)

Usance interest paid for the delayed payment to its holding company was not any part of purchase price of goods and was interest within the definition of term ‘interest’ under section 2(28A), therefore, assessee was liable to withhold tax under section 195 from said payment....

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TDS on payments to Non-Residents: An Overview of Section 195

As we are in the era of digital economy, where BEPS action plans has been issued by OECD to tax digital transactions. With the increase in global transactions, Income tax department is also keeping their bird’s eye to the payments made to a non-residents. There has been substantial increase in foreign remittances from India. Indian [&he...

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NO TDS Deduction on Reimbursement to Foreign Entity

A pure reimbursement doesn't constitute a reward or compensation paid for a service rendered. Hence, a mere reimbursement of expenses cannot be construed as ‘royalty’ or ‘payments for services rendered’ since what is achieved by a reimbursement is a mere repayment of what has been already spent....

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TDS u/s. 195 in respect of payments to Foreign Professionals, Teachers etc. –Independent Personal Services

In respect of foreign payments, TDS u/s. 195 is quite a grey area of the Indian Income Tax Act (act).  Every payment to a non resident  is not liable for TDS u/s. 195.   A decision as to the coverage of any payment u/s. 195 requires  determination about taxability of income in the hands of NR […]...

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TDS U/s. 195 not deductible on commission paid to USA based payee

ACIT Vs M/s Calcutta Export Co. (ITAT Kolkata)

ACIT Vs M/s Calcutta Export Co. (ITAT Kolkata) The Revenue has failed to place on record even a single document throwing light towards the fact that the payee herein has rendered any of its services in India thereby making it liable to be assessed u/s 9 r.w.s 5 of the Act. The assessee’s payee has […]...

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