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TCS u/s 206 C-1H

Eajaz Ahmad (Accountant) (129 Points)

05 October 2020

Sir,
Can we have some example with regard to September & October 2020 Receipts respectively

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9 Replies

Sagar Patel (Tax and Business Consultant) (11611 Points)
Replied 05 October 2020

What is your query, sir ?
can you elobrate

Eajaz Ahmad (Accountant) (129 Points)
Replied 05 October 2020

Thank you very much Sir, for considering my Query.
Assuming 2019-20 Turnover is Rs.11 crores..
In year 20-21..
1) September Sales 23,00,000
October. Sales 68,00,000

2) September Sales 76,00,000
October. Sales 7,00,000

Kindly explain on how much TCS will be applicable.

Sagar Patel (Tax and Business Consultant) (11611 Points)
Replied 05 October 2020

As Turnover of F.Y 2019-20 is more than 10 crore TCS provision is applicable to you.

Provisions relating to TCS with effect from 1st October, 2020 to provide that seller of goods shall collect tax @ 0.1 per cent (0.075% up to 31.03.2021) if the receipt of sale consideration from a buyer exceeds Rs. 50 lakh in the financial year.
So, if you received more than 50 lakh from any person for sale of Goods in a financial year than required to collect TCS.

#I assume sale given by you is sale to single person.

In case No. 1.......23 lakh+68 lakh = 91 lakh
TCS required to be collected on 41 lakh

In case No. 2.......76 lakh + 7 lakh = 83 lakh
TCS required to be collected on 7 lakh (i.e Amount received after 1 st October, 2020)

3 Like

Eajaz Ahmad (Accountant) (129 Points)
Replied 05 October 2020

Thank you sir,
Both the scenarios are same.
why in the 2nd case it is on 7 lakhs.
not on 76+7-50=33 lakhs

Suvendu Biswal (46 Points)
Replied 05 October 2020

What will be the accounting treatment in case of sale and purchase for both seller and purchaser

Sagar Patel (Tax and Business Consultant) (11611 Points)
Replied 05 October 2020

@ Eajaz Ahmad ji

TCS u/s 206C-1H is applicable w.e.f 1st October, 2020
So, to calculate limit of Rs. 50 lakh we have to see total purchase of that person (i.e Buyer) during this year (i.e F.Y 2020-21), but we have to collect TCS only w.e.f 1 st October, 2020

in case 2 Receipt against sale is only 7 lakh, so TCS also required to be collected on that amount Only.

Eajaz Ahmad (Accountant) (129 Points)
Replied 05 October 2020

Thanks a lot sir ji..

Sagar Patel (Tax and Business Consultant) (11611 Points)
Replied 05 October 2020

Most welcome..........

shubham bansal (-) (46 Points)
Replied 12 November 2020

Sir, e.g. Payment received on 09-11-2020 Rs. 15,00,000/- (This payment is in excess of Rs. 50 lacs already received) Now we deposit TCS on Rs. 15 lacs before 07/12/2020 and file TCS return quarterly. Now my query is what document do we give to our seller so he can pay us the TCS amount in our bank account. Another query " IS GST TO BE CHARGED ON TCS ? "