We are placing A foreign PO on Germany for supply, of software,hardware and installation plus maintenance services. That party will utilize their Indian Officer to attend installation but they do not have any set up at India. Can we make payment in foreign currency to Germany for the services given by.Indian staff.
Please guide.
Yes, you can legally make the payment in foreign currency to Germany since your contractual agreement is with the foreign supplier. However, because the installation services are performed in India, the payment qualifies as Fees for Technical Services (FTS) accrued in India. Therefore, you must deduct TDS under Section 195 and submit Forms 15CA and 15CB to your bank before making the remittance.
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