Get 3 Yrs of CCI Pro Membership at Greater Value. Subscribe Now!

Tax (tds) on commission payment

1920 views

Save Share

Join Us Follow Us Add as Source

Arihanth Jain

Chartered Accountant

892 Points Posted on 08 May 2014

My View:

Non Resident agent (NR) has rendered services related to procurement of export orders abroad and also that such NR did not have any business connection/PE in India.

Such services rendered were not utilised in India and also the commission income of NR was neither received nor accrued in India. As a result, the such commission income is not taxable in India u/s 9(1) and there is no obligation on part of Remitter to deduct any TDS u/s 195. DTAA Article 7 shall exempts this income.

However it is advisable that the NR gets a PAN card in India to avoid issues with Sec 206AA.

pankaj birdi

Others

34 Points Posted on 08 May 2014

I read some articles and found that there is no need to deduct the TDS on the commission amount. Follow the below links: https://www.business-standard.com/article/sme/commission-paid-to-foreign-agent-of-indian-company-not-taxable-in-india-113042900626_1.html https://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/taxnewsflaash/Documents/india-april30-2013no1.pdf kindly correct me if i'm wrong.