TDS APPLICABLE UNDER DTAA
Surendra Jha
(Querist) 08 February 2010
This query is : Resolved
a company is USA and her permanent residence is also in USA.She provide Technical & proffession service from outside of india.Her office is in india,but she does not provide service from indian office. does the tax is applicable under dtaa?
A V Vishal
(Expert) 08 February 2010
YES TDS HAS TO BE DEDUCTED EVEN IF THERE IS A DTAA AGREEMENT.
Sachin Bhatia
(Expert) 08 February 2010
Yes the tax is applicable.
Vineet
(Expert) 09 February 2010
This issue is covered by deeming provisions u/s 9 of the Act though the Company is not a Resident in India neither having a permanent establishment in India.
Please refer to provisions of section 9(1)(vii) of the Act in the matter. Liability for withholding tax lies with the service recipient in India.
Though the withholding tax rate prescribed in DTAA with USA is much higher being an old treaty, at present the withholding tax rate applicable is 10% u/s 115A(1)(b)(BB) with applicable surcharge and cess.
