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TDS on royalty

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(Querist)
31 March 2009 Hi,

we want to remit royalty of Rs 50 lac to our parent co. in US, do we need to deduct TDS on it?? if yes what will be rate of TDS?? will it come u/s 194J??? waiting for your valuable reply.

Nazir
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Tushar Yerawar

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Tushar Yerawar (Expert)
31 March 2009 Section 194J is not applicable to Non Resident.

You need to refer DTAA between India and US.

If you parent co. does not have permanent establishment in India then kindly deduct the TDS @10.56% and if they have a PE in India then at 42.23%.
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Nazir

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Nazir (Querist)
31 March 2009 Thanks Tushar, our parent co. is based in US and we are 100% subsidiary of that co. now what will be the scenario??
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CA LOKESH KASAT, FCA, M.Com

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CA LOKESH KASAT, FCA, M.Com (Expert)
01 April 2009 Deduct TDS @10% but do remeber of Arms Length price.
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