The Central Board of Direct Taxes, on 24th July, 2020, notified the Income-Tax (17th Amendment) Rules, 2020 effective from 1st of October, 2020 unless specified otherwise.
The following are the prescribed amendments:
That in relation to the statement of tax collection, at the time of preparation of statements of tax collected, the collector must furnish particulars of the amount received or debited on which tax was not collected:
- by the authorized dealer from the buyer where the amount or aggregate of the amounts being remitted by a buyer is less than seven lakh rupees in a financial year and is for a purpose other than the purchase of overseas tour program package,
- by the authorized dealer on an amount in respect of which the sum has been collected by the seller and
- by the authorized dealer or seller of an overseas tour program from the buyer who is liable to deduct tax at source under any other provision of the Income Tax Act, 1961 and has deducted such amount; or
- 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 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.
Furthermore, the collector must furnish particulars of the amount received or debited on which tax was not collected from the buyer:
- where the buyer was liable to deduct tax at source under any other provision of the Income Tax Act, 1961 and has deducted such amount and
- where the “buyer” was the Central Government, a State Government, an embassy, a High Commission, legation, commission, consulate and the trade representation of a foreign State; or a local authority or 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
In respect of relaxation from deduction of tax at a higher rate under section 206AA, the Amendment provides that in case of a non-resident deductee, other than a company, or a foreign company and not having a PAN, the provisions of section 206AA shall not apply in respect of payments in the nature dividends as well as interest, royalty, fees for technical services and payments on the transfer of any capital asset.
The amendment also clarifies that credit for tax collected at source shall be given to the person from whose account tax is collected and paid to the Central Government account for the assessment year relevant to the previous year in which such tax collection is made.
The amendment also provides for the substitution of an Annexure dealing with Party Wise Break Up of TCS, in respect of Quarterly Statement of Tax Collection at Source under Form No. 27EQ.
Click here to read the amendment.
