Withholding tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 September 2011 We have engaged lawyer in Germany. India has entered ADT Agreement in 1996 with Germany. As per section 195, we have to withhold 30% t/w tax but as per ADT tax rate is 10%. Tax is deductible at source under section 195 or the rates specified in ADT agreements entered into by the Central Government whichever is lower is the applicable rate plus Surcharge, education cess and secondary and higher education cess.
Let us know the applicability of withholding tax and also surcharge, education cess and )

Vishal D Shah

Vishal D Shah (Expert)
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20 September 2011 Under sec 90 of Indian income tax act, benefit of lower rate of tax is provide. i.e rate prescribed in act or under dtaa between countries. You may avail beneficial rate of 10%.
Make sure recipient has valid pan in India and no part of fees paid by you are connected to his permanent establishment in India, if any.

CA. Anuj Gupta

CA. Anuj Gupta (Expert)
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20 September 2011 Please confirm whether the fees to lawyer is being in his personal capacity or a partner of a LLC/Firm.

Anuj
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