Section 195

Dear Members

Please explain the first line of the Sec 195 (1) i.e. " Any Person responsible for paying to a non resident, not being a company, or to a foreign company".

Please tell me the difference with an example.

Thanks in advance..

Replies (5)

 

You can deduct tds u/s 195 of a non-resident individual …. Deductee should not be  foreign company..

As per my view.

Deductor: - Any Perosn

Deductee: - Non-Resident or a Foreign Company

Assessee can make an application to AO for non-deduction of TDS where the sum payable to Non-Resident or Foreign company, is not taxable in India.

Hello Swohra,

Deductor can be any person it is not required to be a company for the dedction of TDS on payment to a Non - Resident.

Thanks & Regards

For your Reference:

https://www.vakilno1.com/bareacts/incometaxact/s195.htm

hi swohra

Any person responsible for making payment to a non-corporate non-resident or to a company other than a domestic company of any interest or any other sum...........

 

As far as deductor is concerned, it can be any person (Individual, firm, company etc.)

 

In case of deductee the section spells out " to a non resident, not being a company, or to a foreign company "

Splitting the phrase into two parts 

1. to a non resident, not being a company - Means any NON CORPORATE NON RESIDENT ENTITY

2. to a foreign company

Now as per Section 6 of the Act, an Indian Company is always resident in India. While residential status of a foreign company depends upon where it is controlled and managed from. No matter whether a foreign company is resident in India or Non Resident in India depending upon its control and management, tax has to be deducted from any payment chargeable to tax in India made to such company.

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