Tds on payment to facebook
This query is : Resolved
16 January 2017
if an indian company is paying advertisement payment to Facebook...then tds should be deducted on such payment.
CA Suresh Jain
(Expert)
18 January 2017
Yes, TDS has to be deducted
27 July 2025
When an Indian company pays advertisement fees to **Facebook (a foreign company)**, TDS provisions under **Section 195** of the Income Tax Act apply because the payment is made to a non-resident.
### Key points:
* **Nature of payment:** Advertisement service fees.
* **TDS section:** Section 195 (Payment to non-resident).
* **TDS rate:** Generally **10%** on the gross amount (payment made).
* **TDS to be deducted on:** The **gross payment amount** (total invoice value before any deductions).
* **Note:** If DTAA (Double Taxation Avoidance Agreement) between India and USA (Facebook’s jurisdiction) provides a lower rate, that can be applied if a valid Tax Residency Certificate (TRC) is furnished.
---
### Example:
* Invoice from Facebook for ad services: ₹1,00,000
* TDS @ 10% = ₹10,000 to be deducted and paid to the government.
* Payment made to Facebook = ₹90,000 after TDS deduction.
---
### Summary:
| Parameter | Details |
| ----------------- | -------------------------------- |
| Nature of payment | Advertisement fees |
| TDS Section | 195 |
| TDS Rate | 10% (subject to DTAA provisions) |
| TDS on amount | Gross payment amount |
---
### Key points:
* **Nature of payment:** Advertisement service fees.
* **TDS section:** Section 195 (Payment to non-resident).
* **TDS rate:** Generally **10%** on the gross amount (payment made).
* **TDS to be deducted on:** The **gross payment amount** (total invoice value before any deductions).
* **Note:** If DTAA (Double Taxation Avoidance Agreement) between India and USA (Facebook’s jurisdiction) provides a lower rate, that can be applied if a valid Tax Residency Certificate (TRC) is furnished.
---
### Example:
* Invoice from Facebook for ad services: ₹1,00,000
* TDS @ 10% = ₹10,000 to be deducted and paid to the government.
* Payment made to Facebook = ₹90,000 after TDS deduction.
---
### Summary:
| Parameter | Details |
| ----------------- | -------------------------------- |
| Nature of payment | Advertisement fees |
| TDS Section | 195 |
| TDS Rate | 10% (subject to DTAA provisions) |
| TDS on amount | Gross payment amount |
---
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