TDS on Remittance in Dubai
This query is : Resolved
26 September 2025
LLP wants to remit approx 40L to Artist in Dubai. Is TDS deduction is applicable as there is no Tax Dubai.
26 September 2025
TDS (Tax Deducted at Source) may still be applicable on a payment made by an Indian LLP to an artist in Dubai, regardless of whether Dubai itself levies any income tax. The obligation arises from Indian tax law, specifically Section 195 of the Income Tax Act, which requires deduction of TDS on payments to non-residents if the income is chargeable to tax in India. The absence of tax in the recipient’s country does not automatically exempt the remitter from deducting TDS in India if the sum paid is considered taxable under Indian law.
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26 September 2025
TDS is to be deducted on any payment (other than salary) to a non-resident if such income is chargeable to tax in India, irrespective of whether the recipient's country imposes tax on such income.
The fact that Dubai imposes no income tax does not negate the requirement to deduct TDS under Indian law.
The nature of the payment (for example, artist’s fee) is important—if the payment is for services rendered or performance in India, or for exploiting rights in India, then this income is likely to be deemed taxable in India, and TDS under Section 195 is mandated at rates specified in the Income Tax Act or the India-UAE Double Taxation Avoidance Agreement (DTAA), whichever is beneficial to the recipient.
If the income is not deemed to arise or accrue in India (for example, if the artist performed entirely outside India and the payment has no link to any Indian source or exploitation), a view could be taken that TDS is not required, but this should always be supported by proper documentation or a certificate from the Indian tax department (Lower/Nil Deduction Certificate or Form 15CB from a Chartered Accountant).
The fact that Dubai imposes no income tax does not negate the requirement to deduct TDS under Indian law.
The nature of the payment (for example, artist’s fee) is important—if the payment is for services rendered or performance in India, or for exploiting rights in India, then this income is likely to be deemed taxable in India, and TDS under Section 195 is mandated at rates specified in the Income Tax Act or the India-UAE Double Taxation Avoidance Agreement (DTAA), whichever is beneficial to the recipient.
If the income is not deemed to arise or accrue in India (for example, if the artist performed entirely outside India and the payment has no link to any Indian source or exploitation), a view could be taken that TDS is not required, but this should always be supported by proper documentation or a certificate from the Indian tax department (Lower/Nil Deduction Certificate or Form 15CB from a Chartered Accountant).
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26 September 2025
Determine whether the payment is chargeable to tax in India (source of service, nature of contract, and whether the services are utilized in India are key factors).
If the payment is taxable in India, deduct TDS at the rate prescribed under the Income Tax Act or DTAA.
File Form 15CA (and 15CB, if required) for reporting foreign remittance to the Indian tax authorities.
If there is uncertainty, seek a certificate from the Income Tax Department for lower/no TDS, factual determination.
If the payment is taxable in India, deduct TDS at the rate prescribed under the Income Tax Act or DTAA.
File Form 15CA (and 15CB, if required) for reporting foreign remittance to the Indian tax authorities.
If there is uncertainty, seek a certificate from the Income Tax Department for lower/no TDS, factual determination.
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26 September 2025
Good luck...
27 September 2025
Thank you sir.
Artist (Foreigner) will perform in India.
Whether TDS to be deducted U/s 194E or 195 ?
Artist (Foreigner) will perform in India.
Whether TDS to be deducted U/s 194E or 195 ?
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27 September 2025
TDS (Tax Deducted at Source) is applicable when an LLP in India makes payment to a foreign artist (non-resident) for a performance in India. In this scenario, the artist is a non-resident, and the income is chargeable to tax in India, since the performance is happening within India.
Section 194E specifically applies to payments made to non-resident sportsmen or entertainers (including artists who are not Indian citizens) for performances or appearances in India.
Section 195 is a more general provision, applicable for all other payments to non-residents that are chargeable to tax in India.
Section 194E specifically applies to payments made to non-resident sportsmen or entertainers (including artists who are not Indian citizens) for performances or appearances in India.
Section 195 is a more general provision, applicable for all other payments to non-residents that are chargeable to tax in India.
27 September 2025
For a foreign artist performing in India, Section 194E governs the TDS deduction since it is specific to payments to non-resident entertainers and does not require assessing whether the income is taxable in India—that determination is already implicit in this section.
TDS Rate and Deduction
The TDS rate under Section 194E is 20% (plus applicable surcharge and cess).
Deduction must be made at the time of credit of such income to the payee or at the time of payment, whichever is earlier.
TDS Rate and Deduction
The TDS rate under Section 194E is 20% (plus applicable surcharge and cess).
Deduction must be made at the time of credit of such income to the payee or at the time of payment, whichever is earlier.
27 September 2025
You are welcome.
06 October 2025
In continuation with Earlier Query,
Payment to be made to foreign Artist, Artist is saying not to deduct TDS on the basis of Form 10F.
who has to file Form 10F whether LLP (Person making Payment to Foreign artist) has to file Form 10F or Foreign Artist has to file Form 10F?
How will the same can be shown in Form 15CA/CB ?
Payment to be made to foreign Artist, Artist is saying not to deduct TDS on the basis of Form 10F.
who has to file Form 10F whether LLP (Person making Payment to Foreign artist) has to file Form 10F or Foreign Artist has to file Form 10F?
How will the same can be shown in Form 15CA/CB ?
06 October 2025
Form 10F is a self-declaration filed by the non-resident (i.e., the foreign artist), not the LLP making the payment.
The purpose of Form 10F is to claim relief under the DTAA and confirm residency status, so the Indian payer can apply a lower TDS or no TDS if the DTAA conditions are met.
Form 10F must be accompanied by a Tax Residency Certificate (TRC) from the foreign artist's country.
Filing Form 10F is now electronic and mandatory for all non-residents, regardless of whether they possess a PAN in India.
The LLP must collect Form 10F and TRC from the foreign artist and keep them for records and TDS assessment purposes.
The purpose of Form 10F is to claim relief under the DTAA and confirm residency status, so the Indian payer can apply a lower TDS or no TDS if the DTAA conditions are met.
Form 10F must be accompanied by a Tax Residency Certificate (TRC) from the foreign artist's country.
Filing Form 10F is now electronic and mandatory for all non-residents, regardless of whether they possess a PAN in India.
The LLP must collect Form 10F and TRC from the foreign artist and keep them for records and TDS assessment purposes.
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06 October 2025
Thank you Sir.
If form 10F is received from the artist alongwith TRC, then for remittance how to consider the TDS (whether lower/Nil) in form 15CA/CB?
Will Form 15CB required in Case No TDS as per form 10F?
If form 10F is received from the artist alongwith TRC, then for remittance how to consider the TDS (whether lower/Nil) in form 15CA/CB?
Will Form 15CB required in Case No TDS as per form 10F?
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06 October 2025
The rate of TDS will apply as per DTAA agreement with the country.
No, form 16CB will not apply in case of NIL TDS.
No, form 16CB will not apply in case of NIL TDS.
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