Income Tax : The court held that tax authorities cannot rely on earlier findings already set aside by appellate bodies. Each Section 197 applic...
Income Tax : Payments for sports sponsorship that grant global trademark usage can be split as royalty. Courts upheld withholding where tradema...
Income Tax : Detailed comparison of dividend, interest, royalty, and FTS withholding tax rates between India's Income-tax Act and over 60 Doubl...
Income Tax : An analysis of Double Taxation Avoidance Agreement (DTAA) withholding tax rates across various countries for dividends, interest, ...
Income Tax : In-depth analysis of Section 195 TDS on payments to non-residents, covering taxability, DTAA interaction, PAN rules (206AA), Form ...
Income Tax : 20% Withholding Tax Rate on profits distributed by unlisted companies to shareholders through buy-back of shares Existing provisio...
Income Tax : Ending year-long battle, UK-based Vodafone has agreed to pay USD 400 million more to its Indian partner Essar for buying its 33 pe...
Income Tax : The government will look into more cross-border mergers involving Indian assets, like the Vodafone-Hutchison deal, after the Bomba...
Income Tax : The Finance (No.2) Act of 2009 introduced section 206AA under the Income Tax Act, 1961 (the ITA) to provide that any person who is...
Income Tax : The cost of doing business in India could come down if the dividend distribution tax (DDT) levied on foreign shareholders is repla...
Income Tax : The Tribunal held that consultancy payments for architectural services were not FTS since no technical knowledge was made availabl...
Income Tax : The Tribunal rejected the Revenue’s argument that taxpayers must seek AO determination under Section 195(2) in all cases. It hel...
Income Tax : The court examined whether withholding tax could be imposed solely on the basis of an alleged virtual service permanent establishm...
Income Tax : Court held that dividend remains income of the shareholder and DDT is an additional income tax covered under Article 2, restrictin...
Income Tax : Supreme Court admits appeal by Tesco Bengaluru against CESTAT ruling on reverse charge service tax for seconded overseas employees...
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 : For the purpose of making disallowance of other sums chargeable under Section 40(a)(i) of the Income-tax Act, 1961, in the case of...
Income Tax : 37BC. Relaxation from deduction of tax at higher rate under section 206AA.– (1) In the case of a non-resident, not being a compa...
Income Tax : Notification No. 93/2015 - Income Tax G.S.R. 978(E) dated 16th December, 2015 A CA certificate in Form No. 15CB will be required t...
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.
Provisions of tax deduction at source (TDS) with regard to payment of any other sum to a non-resident is covered under section 195 of the Income Tax Act, 1961 which are explained hereunder.
Since the title in goods passed from foreign suppliers to assessee outside India at the port of shipment and AO failed to show as to how income of foreign parties was chargeable to tax in India, therefore, no income had accrued to foreign parties in India in terms of section 5 and section 9, therefore, section 195 did not apply to payments.
M/s. Wipro Limited Vs ACIT (ITAT Bangalore) In this case relief was allowed by learned CIT (A) in respect of levy of surcharge and cess by directing the AO that surcharge and cess should be levied only in the cases where the non resident vendors are residents of countries with which DTAA allows withholding rate […]
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,
ITAT held that the business receipts of the foreign residents are not taxable in India since the agents have no PE in India and therefore, the assessee was not required to make TDS u/s 195 of the Act. Therefore, the assessee’s appeals for all the three A.Ys are allowed.
I am trying to start the series of Frequently Asked Questions on Payments to Non Residents. I have prepared the same based on my past experience and based on questions asked to me by my clients or professional colleagues.
If no tax is deductible under section 195(1), section 40(a)(i) of the IT Act will not come in the way of the appellant claiming such deduction from its income: Barclays Bank Plc case
M/s. Google India Private Ltd. Vs. Addl. CIT (ITAT Bangalore); TDS on royalty payments under section 195(2): Applicability of DTAA cannot be determined suo-moto by AO without there being any application
Assessee cannot be held liable to deduct tax at higher of the rates prescribed in section 206AA in case of payments made to non-resident persons having taxable income in India in spite of their failure to furnish the Permanent Account Numbers.
