TDS on Royalty

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This query is : Resolved

Rekha (Querist)

24 February 2008 What is the TDs rate to be deducted for non resident individual when there is no agreement with the non resident and the pyament is advance amount

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)

24 February 2008 1. What is the nature of payment?What do you mean by advance payment?
2. Is there DTAA?

Madhusudhan BS

Madhusudhan BS (Expert)

25 February 2008 The heading for the query is given as TDS on royalty. Therefore I assume that the payment is towards royalty. Whether there is an agreement or not, as long as the payment is in the nature of royalty, the TDS has to be deducted. Advance payment also attracts TDS. The DTAA provisions are country specific.

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)

25 February 2008 The problem is royalty will not be paid in advance, where as a technical know-how fee (a portion) may be paid inadvance. That is why it is better to know from the queriest the exact nature, before expressing opinion. Secondly, if DTAA specifies a lower rate then that will prevail

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