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TCS under Income Tax Act, 1961
-CA. Shikhar Garg
- Blue colored text are the rates changed by “Self-Reliance India” Package announced by Hon’ FM on 13th May’20.
- Green colored text is the amendment made by Finance Act 2020
Sections | Description | Existing Rate | Reduced rate from 14-5-2020 to 31-3-2021 | Conditions |
206C(1) | TCS on sale of Alcoholic Liquor for human consumption | 1% | 1% | · Every person being a seller shall collect the tax when amount debited to the account of buyer or at the time of receipt of such amount in any mode whichever is earlier. · No collection of tax shall be made if a resident buyer furnish a declaration that the goods are to be utilised for the purposes of manufacturing, processing or producing articles or things or for the purposes of generation of power and not for trading purposes. (206C(1A)) · Tax collector shall submit the above-mentioned declaration to the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner on or before the seventh day of the month next following the month in which it is made. (206C(1B)) · Buyer means a person who obtains in any sale, by way of auction, tender or any other mode, goods of the nature specified or he right to receive any such goods but does not include, — o a public sector company, the Central Government, a State Government, and an embassy, a High Commission, legation, commission, consulate and the trade representation, of a foreign State and a club; or o a buyer in the retail sale of such goods purchased by him for personal consumption · Seller means the Central Government, a State Government or any local authority or corporation or authority established by or under a Central, State or Provincial Act, or any company or firm or co-operative society and also includes an individual or a Hindu undivided family whose total sales, gross receipts or turnover from the business or profession carried on by him exceed one crore rupees in case of business or fifty lakh rupees in case of profession |
TCS on sale of Tendu leaves | 5% | 3.75% | ||
TCS on sale of Timber obtained under a forest lease | 2.5% | 1.875% | ||
TCS on sale of Timber obtained by any mode other than under a forest lease | 2.5% | 1.875% | ||
TCS on sale of Any other forest produce not being timber or tendu leaves | 2.5% | 1.875% | ||
TCS on sale of scrap | 1% | .75% | ||
TCS on sale of Minerals, being coal or lignite or iron ore | 1% | .75% | ||
206C(1C) | TCS on granting of contract for parking lot | 2% | 1.5% | · Every person who grants a lease or license or transfer any right or interest in whole or part of such lease license to other person except Public Sector Company) is liable to collect the tax. · Such person shall collect the tax either at the time of debiting such amount or at the time of receipt of such amount in any mode whichever is earlier. · Mining and quarrying shall not include mining and quarrying of mineral oil. Mineral Oil includes petroleum and natural gas. |
TCS on granting of contract for toll plaza | 2% | 1.5% | ||
TCS on granting of contract for mining and quarrying | 2% | 1.5% | ||
206C(1F) | TCS on sale of motor vehicle | 1% | .75% | · Every person being a seller shall collect TCS from the buyer if the sale amount exceeds `10 lacs. · Buyer means a person who obtains in any sale, goods of the nature specified in the said sub-section, but does not include - o the Central Government, a State Government and an embassy, a High Commission, legation, commission, consulate and the trade representation of a foreign State; or o a local authority as defined in Explanation to clause (20) of section 10; or o a public sector company which is engaged in the business of carrying passengers. |
| 206C(1G) | TCS on amount received for remittance out of India under the Liberalised Remittance Scheme of RBI or overseas tour package programme | 5% | 5% | · Every person who is authorized dealer for the scheme or seller of an overseas tour programme package.· Tax shall be collected either when the seller receives the amount by any mode, or the amount is debited to buyer’s account.· The authorized dealer shall collect TCS only if the amount or aggregate of such amount in a financial year to be remitted out of India under the scheme (except for overseas tour programme) is more than Rs. 7 Lacs and TCS shall be collected on the excess amount only.· The rate of TCS shall be 1.5% if the amount or aggregate of such amounts is more than Rs. 7 Lacs, and to be remitted out of India for a loan obtained from any financial institution as defined in section 80E, for the purpose of pursuing any education.· TCS shall not be collected:o For authorized dealer if seller has already collected the TCSo If buyer is liable to deduct TDS under any provision of this act and has deducted such amounto If the buyer is - the Central Government, a State Government, an embassy, a High Commission, a legation, a commission, a consulate, the trade representation of a foreign State, a local authority as defined in the Explanation to clause (20) of section 10 or any other person as the Central Government may, by notification in the Official Gazette |
| 206C(1H) | TCS on sale of goods other than mentioned above | 0.1% | .075% | · Every person who receives any amount in consideration for sale of goods of the value or aggregate of such value more than ` 50 Lakhs shall at the time of receipt of such amount collect the tax.· Seller (the person liable to collect TCS) means a person whose total sales, gross receipts or turnover exceeds ` 10 Crores in the year immediately preceding the F/Y in which the sale is carried out.· TCS shall not be collected:o If Goods are to be exported out of Indiao If the buyer is liable to deduct TDS under any provision of this act on the goods purchased by him from the seller and has deducted such amount.o If TCS is required to be collected u/s 206C(1), 206C(1F) or 206C(1G).· Buyer shall not include :o The Central Government, a State Government, an embassy, a High Commission, legation, commission, consulate and the trade representation of a foreign State; oro A local authority as defined in the Explanation to clause (20) of section 10; or o A person importing goods into India or any other person as the Central Government may, by notification in the Official Gazette, specify for this purpose, subject to such conditions as may be specified therein; |
Other Important Points :
- If the person who is paying any amount on which tax is collectible, fails to furnish the PAN to the person responsible for collecting such tax, in such case higher of the following rates shall be collected from him:
- Twice the rate specified above, or
- At the rate of 5%.
Note : If the Buyer has not provided the Permanent Account Number or the Aadhaar number to the seller, then the rate of collection shall be 1 % (as against 5% mentioned above).
- Payment of the tax collected is to be made to the credit of the Central government within the prescribed time i.e. 7th of the following month in which the tax is collected.
- The statement of return is to be filled periodically i.e. quarterly .
- If a person liable to collect tax fails to collect such tax in part or whole, he shall be deemed to be Assessee in default.
- He shall not be deemed to be Assessee in default in respect of such tax if:
- If the buyer or licensee or lessee has furnished his return of Income Tax under sec 139 and
- has taken into account such amount for computing income in such return of income and
- has paid the tax due on the income declared by him in such return of income and
- the person furnishes a certificate to this effect from a Chartered Accountant in the manner specified.
