TDS u/s 195 : Please help

1) On what basis do we have to judge whether we have to deduct TDS on payments made outside India? 

2) Do we have to deduct TDS on payments made purely to a Foreign Co. (ie. Foreign Co. having no branch / subsidiary co. in India)?


3) Is it that the we have to deduct TDS of those Foreign Companies who have their Subsidiary / branch in India? 

Please help me understand..


Regards,
Devendra Kulkarni

Replies (1)
Originally posted by : Devendra

1) On what basis do we have to judge whether we have to deduct TDS on payments made outside India? 

 

The Income should be either received in india or accrue or arise or deemed to accrue or arise in india to make it taxable in india. Kindly go through section 4,5,6 and 9 of income Tax Act, 1961 to understand the same


2) Do we have to deduct TDS on payments made purely to a Foreign Co. (ie. Foreign Co. having no branch / subsidiary co. in India)?

 

Yes, if the income is deemed to accrue or arise in india to then the same shall be  taxable in india, kindly read section 9 in great detail.


3) Is it that the we have to deduct TDS of those Foreign Companies who have their Subsidiary / branch in India? 



If subsidiary is thereand the payment is made to foreign party then the nature of payment needs to be seen, but if branch is there then surely there is TDS liabillity.

 

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