Few Indian members of an US Based Non profit Organisation have to Yearly remit money towards membership fees & testing charges (if they avail the service of testing their product). Can I know if TDS has to be deducted from such payments, If yes then what rate. The US Organisation also do not have any PAN No.
A proprietory organization in India represents a US non-profit professional society. The US non-profit professional society has certification program. The certificate is issued to individual after passing 5 exams. The Indian organization collects the fee from individuals, keeps some part to meet administrative expenses and remits the balance exam fees to the US organization. The Indian organization also remits royalty fees to the US organization for reprinting study materials in India.
Under section 195, the TDS should have been deducted. However, since India has a treaty for avoidance of double taxation (ADT), and since the US organization is non-profit and exempt from paying taxes, logically there should be no need to deduct TDS.
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