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TDS on royalty

25 February 2021

what will be tds rate on payment of royalty to foreign company. if we have TRC and No PE certificate available with us. PAN is not available.

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5 Replies

Practitising CA (57 Points)
Replied 25 February 2021

TDS Shall be deducted u/s 195 read with applicable DTAA/TIEA

Shama Shaikh (51 Points)
Replied 25 February 2021

Thank you Sir. Tds rate as per DTAA is 10 percent. but can we apply 10 if company dont have PAN.

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debora M (BUSINESS DEVELOPMENT MANAGER) (1697 Points)
Replied 26 February 2021

As per section 195(g), the rate of TDS on royalties is 10%+3%Cess(if the Foreign Co possesses PAN) and if the agreement between the Foreign Co and Government/Indian Concern is approved by Central Govt or the agreement is in accordance with the Industrial Policy.