What is the diffrence between tax deducted at source and tax collected at source U/s 206C?
TDS happens while making a payment — it is a deduction from the recipient's income. To wit, TDS from salary. TCS happens in a diametrically opposite situation.
Under Section 206C, a seller of scrap is required to collect tax at the rate of 1 per cent of the selling price.
While TDS pares down one's receipts, TCS heightens one's purchase bill. While TDS is normally resorted to expedite tax collection and foil tax evasion, the aim of TCS is to bring into the tax net the hard-to-tax categories.
Both, however, abate against the actual tax liability.
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