TDS on Purchase of Services (Out of India)
Hope you all are doing well & safe. There is an issue I'm proprietor of a business (services / NO GOODS > specifically IT). While filing ITR for FY 2019-2020, my new CA has mentioned that because last year my previous CA had done audit so TAN becomes mandatory for me which is maybe true.
But the concerning part is that he says I've to pay TDS from my pocket for the services I purchased from companies based out of India for servers, technical, domains, etc. Is this true? I mean if those individuals or companies are not making money in India, then why Goverment is asking for TDS?
As I'd no information about this Audit - TAN relation, I didn't applied for TAN & not paid. So what will be the process now?
Looking for your help, because this is very serious for me.
For example in regards to Hosting service from a datacenter we purchase every month, do we really have to pay TDS for them because in no way that company will understand or get that TDS amount.
I read this:
And is there any limit / basic amount for which invoice should be? So that it can even fall under TDS.
Do I have to pay any Service Tax /GST also on those services?
What you think?
However, if only hosting services is received then the same would be not attract TDS, considering the explanation in rhe various jufgements. There is no such limit for the TDS deduction. And for your info, in case you deduct TDS for any forign company, such company can claim benefit of TDS deducted when they file their returns as mentioned in DTAA agreements.
And yeah the GST would be payable by you under RCM as it is import of service, but anyway you can take back the credit of whatever GST you pay.