Income Tax : Tax on dividends, interest, royalties and FTS earned by non-residents is governed by the more beneficial rate under the Income-tax...
Income Tax : The applicable withholding tax depends on the Income-tax Act or the relevant DTAA, whichever is more beneficial. Treaty rates diff...
Income Tax : Section 194-IA requires buyers of immovable property to deduct TDS at 1% when the sale consideration or stamp duty value is ₹50 ...
Income Tax : When a resident buys unlisted shares from a non-resident, TDS must be deducted on gross consideration under Section 195, subject t...
Income Tax : Payments for sports sponsorship that grant global trademark usage can be split as royalty. Courts upheld withholding where tradema...
Income Tax : Direct & Indirect Taxes : Monthly Updates Date & Time – 3rd December 2022 (Time:11 a.m to 12:30 p.m) Tax Guru is Organiz...
Income Tax : Clarification on certain procedural and technical issues regarding the Income Disclosure Scheme, 2016 (IDS) under section 119 of t...
Income Tax : Finance Act, 2012 extended the obligation to withhold taxes to non- residents irrespective of whether the non-resident has -...
Income Tax : Government has recently modified the Foreign Exchange Management (Current Account Transactions) Rules, 2000 and the Liberalized Re...
Income Tax : The Supreme Court judgement on Vodafone tax case seems to have opened a Pandora's box with exporters too expressing reservation on...
Income Tax : Interest income earned by a foreign bank from foreign currency loans extended to Indian corporates was taxable on a gross basis. S...
Income Tax : ITAT Delhi held legal services are not FTS under Section 9(1)(vii) and directed partner-wise DTAA examination. FTS addition was de...
Income Tax : ITAT Delhi held that IT, salary and travel reimbursements without any profit element were not taxable and deleted the disallowance...
Income Tax : Delhi High Court held the ITAT failed to properly examine the ‘make available’ test for secondment payments, set aside its ord...
Income Tax : ITAT held no TDS was required as the Revenue failed to prove the services made technical knowledge available under the India-US DT...
Income Tax : CBDT notifies the Income-tax (Seventh Amendment) Rules, 2025, updating Forms 26Q and 27Q to include Section 194T on payments to fi...
Income Tax : it has been decided that no such request for Form 15E for certificates under section 195(2) & 195(7) for a particular Financial Ye...
Income Tax : CBDT vide notification No. 18/2021-Income Tax, Dated: March 16, 2021 inserted new rule 29BA. Application for grant of certificate ...
Income Tax : Clarification on orders dated 31.03.2020 and 03.04.2020 issued under section 119 of the Income-tax Act, 1961 (the Act) by CBDT vid...
Income Tax : In case of pending applications for lower/nil rate of TDS/TCS for F.Y. 2019-20, the Assessing Officers have been directed to dispo...
As per section 195(1) of Income Tax Act, any person responsible to for paying to a non-resident, not being a company, or to a foreign company, any interest or any other sum chargeable to tax shall, at the time of credit of such income or at the time of payment, whichever is earlier, deduct income-tax thereon at the rates as applicable.
Please also refer the case JLC Electromet Pvt. Ltd. Vs ACIT (ITAT Jaipur). I’m trying to analyse only some of the provisions applicable, only for understanding purpose. As per Section 195 of Income Tax Act, any person who makes payment to non-resident by way of interest (except the interest as specified in Sections 194LB or […]
Public consultation on the proposal for amendment of Income-tax Rules 1962, to inset new rule 29BA and Form 15E, to give effect to the amendment in section 195 of the Income-tax Act, 1961 (the Act) vide Finance (No.2) Act 2019- reg.
Section 206AA does not override provisions of section 90(2) and in case of payment made to non-resident, assessee correctly applied rate of tax prescribed under concerned DTAAs and not as per section 206AA because provisions of the DTAAs were more beneficial and DTAA acquired primacy in such case.
Commission paid to foreign agents for procuring export orders could not be treated as income taxable in India when parameters of DTAAs were applied to transactions in question. Also non-resident agents did not have PE or business connection in India. Therefore, impugned payment could not be held as taxable in the hands of non-resident agents in India and, therefore, liability to withhold tax under section 195 did not arise.
Consideration paid by assessee for services rendered by non-resident were purely in the nature of procurement services and could not be characterized as ‘managerial’, ‘technical’ or ‘consultancy’ services and thus, could not be classified as fee for technical services and accordingly, not liable for deduction of tax at source under section 195.
Services rendered by foreign concern for introducing a client did not make-available any technical knowledge, experience, skill, know-how or processes to assessee, therefore, related payment did not fall within the realm of “Fees for included services” as envisaged in Article 12 of the Indo-US, DTAA and payment made to foreign concern constituted its business profits within the meaning of Article 7 Indo-USA DTAA, and in the absence of any Permanent Establishment of the said foreign concern in India no taxability arose and, therefore, assessee was not liable to withhold tax under section 195.
Coming to the provisions of section 40(a)(ia) of the Act, the said section also provides that any interest, royalty, fees for technical services or other sum chargeable under this Act on which tax is deductible at source under chapter XVII-B and such tax has not been deducted or after deduction has not been paid on or before the due date specified in section 139(1) of the Act. We therefore find that both the provisions of section 195(1) as well as 40(a)(ia) of the Act talks about deduction of tax at source where the sum is chargeable under this Act.
it has been decided to raise threshold of revenue effect for issue of certificates under section 197/195 needing approval of the Commissioner of Income Tax (Intl. Taxation) to Rs. 10 Crore. This threshold will be applicable for all stations in respect of all applications of non-resident taxpayers either pending as on date or filed hereafter. […]
When the commission paid to the non-resident agents was neither received or deemed to be received in India nor accrued or was deemed to accrue in India, no income was chargeable to tax under the provisions of the Act. When the payment made by assessee to the overseas agent for services rendered abroad was not income chargeable to tax in India, there was no obligation cast upon assessee to deduct tax at source under section 195 and consequently, the provisions of section 40(a)(ia) would not be attracted.
