Information on TCS on Goods Sale- FAQs | Section 206C (1H) | Tabular Presentation
Article explains who is accountable for TDS on product beneath Section 206C(1H), From whom tax shall be collected, temporal order of assortment of TCS, what’s the Definition of products, whether or not Transactions in securities through RSE is susceptible to TCS, TCS on motorized vehicle, TCS on dealing in electricity, TCS on sale of software system, TCS on sale of jewelry, TCS on selling of products, further out of pocket expense to be enclosed, Rate of TCS, whether or not TCS on worth together with GST, TCS on bury branch transfers and What If purchaser has multiple units?
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| 1 | Who is Liable?? | Tax is needed to be collected by someone carrying on business whose total sales, gross receipts or turnover exceeds Rs. ten crores within the year now preceding the year of sale. Author Notes: Sale includes sale of products furthermore as revenue from services to come to a decision regarding who is liable. |
| 2 | From whom tax shall be collected? | Tax is needed to collected from a customer if following conditions square measure satisfied: a) there’s Sale of products b) merchant receives quantity of thought purchasable of products exceptional Rs. fifty lakhs throughout any previous year Author Notes: Sec 206C(1H) is applicable solely on sale of products and therefore not applicable on Service suppliers. Thought includes advances received for the sale of products. Exports and Imports are exempted from the relevance of this section. Additional no TCS liability if tax is subtracted or collected below the other provision of Act. |
| 3 | Timing of the TCS Collection? | Tax ought to be collected at the time of receipt of quantity from the customer if the worth of sale thought received in a very previous year exceeds Rs. 50 lakhs Author Notes: ton of Doubts are raised on this issue. Please note solely the number of thought received once 01.10.2020 would attract TCS liability. quantity of thought can be advance conjointly. Another purpose that deserves thought is that quantity received before thirty.09.2020 would even be thought of for threshold of Rs.50 lakhs though TCS would be collected solely from the number received once 01.10.2020. Ex: quantity received throughout FY 20-21 is Rs. one large integer though Rs. 55 lakhs were received before 30.09.2020. currently though Rs.45 lakhs square measure received post 01.10.2020 however still TCS liability would get on Rs. 45 Lakhs |
| 4 | What is meant by goods? | Sale of products Act, 1930 may be a specific statute that deals with the ‘sale of goods’ whereas the CGST Act, 2017 deals with tax on ‘supply of goods’. Thus, the definition of term ‘goods’ will be noted from the Sale of products Act, 1930 for the aim of Section 206C(1H). Author Notes: It ought to be noted that product embody solely movable property. Consequently, the TCS shall not be collected from the sale of stabile property by a developer |
| 5 | Whether Transactions in securities through RSE are liable to TCS? | The CBDT has processed that provisions of this section shall not be applicable in regard to transactions in securities (and commodities) that ar listed through recognized stock exchanges |
| 6 | TCS on motor vehicles? | There is a particular provision in Section 206C(1F) for the gathering of tax on the sale of a motorized vehicle. underneath this provision, the tax shall be collected from each emptor United Nations agency pays any quantity as thought for the acquisition of motorized vehicle valuable surpassing Rs. ten lakhs Vide Circular No. 22/2016, dated 8-6-2016, the CBDT has processed that the provisions of Section 206C(1F) won’t apply on sale of motorized vehicles by makers to dealers/distributors. Author Notes: B2C would attract Sec 206(1F) wherever price of MV exceed Rs. ten Lakhs and 206C( 1H) would apply to B2B dealings |
| 7 | TCS on electricity transaction? | Electricity may be a sensible as per Judicial Precedents. CBDT has processed that TCS is needed to be collected wherever electricity is purchased directly from electricity generation firms and not through power exchanges. |
| 8 | TCS on software sale? | The Supreme Court in its landmark call of Tata practice Services v. State of A.P [2004] 141 collector of internal revenue 132 (SC) control that Canned software system (off the shelf laptop software) ar ‘goods’ and intrinsically assessable to excise. If the sale of software system has been treated as an acquisition of products then the vendor shall be prone to collect TCS subject to the fulfilment of alternative conditions of this provision |
| 9 | TCS on Jewelry Sale? | Yes, if other conditions are also satisfied |
| 10 | TCS on Goods resale? | Business connection has to be noticed i.e. if person re-selling falls within sellers restriction, then he will be liable to collect. |
| 11 | Additional out of pocket expense to be considered? | If they form part of the sales invoice then TCS would be collected as it forms part of sale sunder the consideration. If separate invoice is issued then not liable. |
| 12 | TCS Rate? | The tax shall be collected by the vendor of products at the speed of0.1% of the sale thought surpassing Rs. fifty lakhs if the customer has stocked with his PAN or Aadhaar, otherwise, the tax shall be collected at the speed of I Chronicles. Author Notes: TCS for the desired receipts are reduced by 25% for the amount from 14-05-2020 to 31-03-2021 vide The Taxation and alternative Laws (Relaxation and modification of bound provisions) Act, 2020. Hence, the rate of TCS on sale of products shall be0.075% until 31-03-2021 |
| 13 | Whether TCS on value includes the GST? | Author Notes: it’s been mentioned that TCS is on receipt basis and receipt would be comprehensive of GST and so TCS is needed to be collected on the sale thought comprehensive of GST |
| 14 | TCS or inter branch transferring? | The condition of sale isn’t consummated within the context of branch transfer. Therefore, the provisions of this section shall not apply within the case of branch transfers. |
| 15 | In case buyers have multiple units? | If totally different units of emptor square measure below an equivalent PAN or Aadhaar range, the number received from all such units shall be collective to calculate the limit of Rs. 50 Lakhs. |