Foreign payment query

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When making payments to a foreign company, such as one based in Singapore, for consultancy services exceeding 10 Lacs, you'll need to deduct TDS. Generally, 10% TDS applies under Section 195 for fees for technical services. However, it's crucial to consult an international tax expert to consider factors like tax residency, Permanent Establishment (PE), Double Taxation Avoidance Agreements (DTAA), and grossing up.

md.sarfaraz alam

md.sarfaraz alam (Querist)

15 June 2021 We have to make payment to a foreign company with no base business in India. I want to Know the TDS Rate & section which we can deduct TDS for Consultancy Services received. The Foreign company is Singapore. Total payment is more than 10 Lac

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

15 June 2021 Deduct 10% TDS under section 195 under fees for technical service.

CA Raj Doshi

CA Raj Doshi (Expert)

16 June 2021 Take a written opinion from International Tax Expert specific to your case. Various factors to consider viz Tax residency, PE, Royalty / Fees for Technical service, DTAA, grossing up of TDS etc etc etc

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