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Tds on foreign remitance

TDS 183 views 1 replies

Dear Madam/Sir's,

Namaste!

I have a querry regarding deduction of TDS on foreign remitance.

We are a private limited company receipt of foreign service from a french company and the service rendered outside India i.e.at China. We have to send net proceeds of USD 20,000 towards the service(Fees for technical service). Now my question is what is the applicable TDS rate (% of TDS). If DTTA rate is 10% and Normal Rate of TDS is 10% as per Income Tax Act,1961.

But we don't have PAN of foreign party only we have TRC(Tax Resident Certificate) of the French Company.

If date of transation is before 1st June 2016 and after after 1st June 2016.

Kindly guide me in this matter.

Thanks and Best Regards

Biswojit

 

 

Replies (1)
Ok If you dont have PAN but you do Have TRC then Grossing Up should be done @ DTAA Rate (Bosch Ltd. ITAT Bangalore) and TDS should be deducted @ applicable IT Act Rate or 20%, whichever is higher.::::::: The possible challenges may arise like Foreign Income Tax Authority may decline to give TDS credit in excess of rate prescribed in DTAA.


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