Section 195

I think you query is related to TDS U/s 195
Then as per this section any payment made by any person to non-resident person is chargeable to tds at rate specified in finance act or DTAA whichever is beneficial. but TDs is deducted here only if it is not covered in other sections of non resident.

chintan joshi

25 Points Joined June 2017

Income covered here are Interest income OR any other income to such non resident chargeable to tax in india

Jainam Shah

61 Points Joined April 2017

Thank You Sir

Jainam Shah

61 Points Joined April 2017

Sir What is DTAA ?

PRABIR PAUL

*****Accountant***** Never insult to a

1448 Points Joined January 2017

DTAA means Double Taxation Avoidance Agreement...

A DTAA is a tax treaty signed between two or more countries. Its key objective is that tax-payers in these countries can avoid being taxed twice for the same income. A DTAA applies in cases where a tax-payer resides in one country and earns income in another.

For example you are a Resident Individual in India. Your income is 10,00,000/- in india. TDS deducted @ 10% 1,00,000/-..

As well as you have income from foreign country Rs. 5,00,000/- and you have paid tax in foreign country Rs. 50,000/-

As you are a Resident of India that's why your full 10,00,000+5,00,000=15,00,000/- is taxable in India.

See, here Rs. 5,00,000/- is going to taxable again whether you have already paid tax on that same Income(5,00,000/-) in foreign country.

As per the provision there is no double taxation in income tax....

So that is the reason why two contries needs to sign bilateral agreement...

For more details you may read the provision of section 90, 90A and 91 of Income Tax Act.....

Regards,

Prabir Paul.....