08 November 2014
An Export Oriented Unit have an imported a lab equipment of foreign origin. It has developed some defects and there are no service Centre in India to rectify such defects. Hence, they have Re-exported the defective equipment to the Service Centre of the manufacturer at Germany for Repair and to return. Now the Service Centre in Germany has given an estimate of Euro 600 for “PREVENTIVE MAINTENANCE AND CALIBRATION SERVICE” on that equipment. Here are my doubts. 1. Should there be a deduction of TDS i.e. “withhold tax' on such charges? 2. If so what is the percentage? 3. Is there any way to avoid it or reduce the TDS%?
08 November 2014
Since the Manufacturer has no permanent Establishment with in india you have not to deduct tax at source. You have to obtained CA certificate in form no.15CB to this effect before remitting fees to the service provider.
CAclubindia
