CBDT Amends Form 27EQ: TCS Now Applicable on Luxury Goods and Collectibles

Last updated: 24 April 2025

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The Central Board of Direct Taxes (CBDT) has updated Form 27EQ to include Tax Collected at Source (TCS) on various luxury and collectible items. This new rule applies to goods such as high-end watches, artworks, yachts, helicopters, branded footwear, and home theatre systems. The amendment aims to improve tax compliance and track high-value transactions more effectively.

In a move aimed at expanding the tax base and ensuring better traceability of high-value transactions, the Central Board of Direct Taxes (CBDT) has issued a notification amending the Income-tax Rules, 1962. The amendment, published as the Income-tax (11th Amendment) Rules, 2025, mandates the collection of tax at source (TCS) on the sale of several luxury and collectible items under Section 206C of the Income-tax Act, 1961. According to the notification [G.S.R. 252(E)], TCS will now be applica

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FAQ :

The CBDT has amended Form 27EQ to make Tax Collected at Source (TCS) applicable on the sale of several luxury and collectible items.

TCS is now applicable on items including wrist watches, artworks, collectibles like coins and stamps, luxury transport like yachts and helicopters, sunglasses, handbags, branded footwear, sports kits, home theatre systems, and horses used for racing or polo.

Sellers of these specified luxury and collectible goods are responsible for collecting the TCS from buyers at the applicable rate and depositing it with the income tax department.

Buyers should ensure that the TCS credits are reflected correctly in their Form 26AS to facilitate hassle-free tax filings.

This amendment was issued by the CBDT under the powers conferred by Section 295 read with Section 206C of the Income-tax Act, 1961.

The amendment is effective from the date of its publication in the Official Gazette.

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