Tds

This query is : Resolved

Kartik Charnalia (Querist)
Follow

20 December 2012 Hi, my query is regarding TDS.The query is that the software company purchases its software from a foreign company, and the software company employees are given Amex cards through which they can make payment for the software on behalf of the software company to the foreign company.So, whether the TDS should be deducted by the employees for purchase of software or not.Which section should apply i.e.section 195 or other and why. PLease reply ASAP.

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
Follow

21 December 2012 Yes , the TDS should be deducted based on Indian Income Tax Act, even if payments are made by employees.

However the Treaty of the country where the software foreign company is located needs to be seen.

Anuj
femaquery@gmail.com

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
Follow

27 December 2012 You are buying a product and paying the costume duty and at the time of making the payment you are paying cost + duty. How the TDS us coming in between. Your purchases are imports. As regards payment the card given by the company requires sanction of RBI otherwise you have to procure certificate from CA for foreign remttance

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
Follow

27 December 2012 As per amended definition of royalty by finance act 2012, every software purchase is chargeable as royalty .

Also for online purchase of software for which payments are made through credit card, there is no payment of custom duty.

Anuj
Femaquery@gmail.com

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now