Tds on online subscriptions

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Prem Garg

Partner

21 Points Posted on 17 April 2015

Till now nobody even the Tax officials have been able to reply to my following Questions. Can anybody send me some write ups or articles on this to make a presentation:

1. Almost all the Indian Libraries make online payments or through cheques/RTGS/foreign remittances towards annual or long term subscripttions of online research magazines, journals and other publications to both Indian and foreign publishers

Will such payments qualify under Royalties or purchases?...
Do they need to deduct TDS on such payments?

As foreign publishers want full amount of subscripttion, they are not concerned about Indian Tax Laws and don't have PAN or any PE in India, how and how much TDS to be deducted?
Who will claim benefit of such TDS, because foreign publishers don't file their Tax returns in India?

AND what about the Service Tax Issues?

Replies (2)

CA Gaurav Gupta

Business and Management Consultancy

57 Points Posted on 17 April 2015

Dear Mr. Prem,

I think Question depends upon the nature of service they are taking, If the online subscripttion if in the nature of membership fees than there is no need to deduct TDS on that or if it is in the nature of contract or someting than the respective section of TDS will applicable.

Which i believe in your case, the Indian Libraries making annual aur long term subscripttion fees for online Magzines/publications/ journals are in the nature of membership fees becausing they are paying annual subscripttion. so they there is no TDS applicablity in given case.

Lets take up a example, ,if you are paying the same amount for hardcopy of magzines/publications/journals than the question of TDS deduction will not arise So, the same is applied be in the case of online publications because here you taking the soft copy instead of hard copy.

If you have any other clarification on this than please let me know.

Regards

Sudeesh Kannan

22 Points Posted on 08 April 2019

Hi Sir,

I have some clarification on TDS deduction for AWS/Google services. ie I have made lots of payments to AWS subscripttions and Google Subscripttions through online transfer. But I can't deduct TDS for these services because if we pay the amount after deduction of TDS, it will not take without the actual value, So can you please clarify how we can deduct TDS as per these type of services\.