Withholding tax under section 195 - payment of bank charges
This query is : Resolved
03 March 2017
Dear Sir,
We need to remit bank charges towards extension of Bank Guarantee issued by Doha Bank to our client. We need to pay to our bank in India who has taken this bank guarantee from Doha Bank on our behalf. we need to remit bank charges to Doha bank. do we need to deduct tax? if yes then please give details of tax amount etc.
thanks,
Nilesh
We need to remit bank charges towards extension of Bank Guarantee issued by Doha Bank to our client. We need to pay to our bank in India who has taken this bank guarantee from Doha Bank on our behalf. we need to remit bank charges to Doha bank. do we need to deduct tax? if yes then please give details of tax amount etc.
thanks,
Nilesh
03 March 2017
No TDS applicable as the bank guarantee is issued by a non resident bank out side India and the income is not taxable in India.
03 March 2017
Sir,
Thank you for quick response, however Doha bank is having its presence in India with full fledged branch. But our bank might have directly dealt with foreign branch of Doha bank. in that case even though PE is there, income may not be attributable to the same. Am I correct in holding the same?
thanks
Thank you for quick response, however Doha bank is having its presence in India with full fledged branch. But our bank might have directly dealt with foreign branch of Doha bank. in that case even though PE is there, income may not be attributable to the same. Am I correct in holding the same?
thanks
03 March 2017
Yes you are right in holding the same.
03 March 2017
Sir,
One more doubt is that the nature of said payment may be considered as FTS and in that case it is taxable in both the state. Since the nature of payment appears of FTS to me. Since services are provided by foreign bank.Please give your opinion.
One more doubt is that the nature of said payment may be considered as FTS and in that case it is taxable in both the state. Since the nature of payment appears of FTS to me. Since services are provided by foreign bank.Please give your opinion.
03 March 2017
It is only bank charges not FTS.
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