Withholding tax on business commission
This query is : Resolved
CA Sanjay Baheti
(Querist)
07 August 2010
Is withholding tax applicable on commission paid to Non residents who do not have a permanent establishment in India. The withholding tax table only mentions dividend, interest, royalty and fees for technical services
VINOD ARORA
(Expert)
07 August 2010
In view of withdrawal of circulars 23 and 786, we have to have recourse to S. 9 of IT Act.
Taxable income is not accrued in India if there is no work performed in India and there is no PE in India and the payment is also not received in India by the recepient. Accordingly, if the commission relates to services provided abroad, recepient does not have PE in India and the payment also is received outside India, no witholding taxees required in such a case.
Taxable income is not accrued in India if there is no work performed in India and there is no PE in India and the payment is also not received in India by the recepient. Accordingly, if the commission relates to services provided abroad, recepient does not have PE in India and the payment also is received outside India, no witholding taxees required in such a case.
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