One of My client have paid USD 6,000/- to Non Residen (China) towards Commission & Liasion Charges. Is TDS applicable on this ? Please provide me the Notification No. ?

Posted 4 years ago by Ankit Sharma


It will be come under section 195 of IT act 1961, if the payment made from india to outside (NRI) the India so TDS to be deducted u/s 195 on such payment.




Chartered Accountants


Posted 4 years ago by CA HEMANTH KUMAR Y.S

He has paid to foreign Company, which do not have any establishment in India.

Posted 4 years ago by Ankit Sharma

In the present case, sec 195 & DTAA becomes relevant. Sec 195 tells, any payment of taxable income to a non resident, tds needs to be deducted, how ever this is subject to sec 90 of the IT act. Accoring to sec 90, the provisions of IT or DTAA which ever is beneficial needs to be applied. Hence please check the DTAA of Indo china. This kind of income may not be taxable according to the DTAA.

Posted 4 years ago by Mukesh Jain CA

Very well explained by mukesh.

However if TDS is deducted than TDS certificate should be issued to deductee. And deductee need to file his return to claim refund. He can choose DTAA or incometax provisions, whichever are beneficial to him.

Posted 4 years ago by CA Pulkit Sharma

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