Section 195

A Study on Section 195 TDS on Other Sums

      Scope of section 195

Any Person

Responsible for paying

To a Non-Resident

Not being a Company, or Foreign company

Any interest other than 194LB & 194LC

Or

ANY OTHER SUM

Chargeable under act

Other than Salaries

Shall deduct TDS

At time of credit or payment

Whichever is earlier.

      Application to AO

1.         Person

Responsible for paying

Considers

Whole some Not chargeable

May make application to AO

To determine by order

Appropriate proportion chargeable.

2.       Person

Entitled to receive (NR)

May make application to AO (subject to rule29B & form 15C & 15D)

To grant him certificate

To receive such sum

Without deduction of tax

      Rule 29B Form 15C & 15D

Person	Operating Mode	Eligible income for which application can be made
Foreign Banking Company	Carries Operations Through Branch	Interest Income (not on securities) or any other sum (not being dividend)
Any other Person	Carries Business or profession through Branch	Any sum not being Interest or Dividend

o   Conditions

§  Person must be regularly assessed in India

§  Must have furnished returns of income for all A/Y

§  He is not in default or deemed to be in default under act

§  Has not been subject to penalty U/S 271(1)(iii)

§  For person other than banking additional conditions:-

·         Must be carrying business or profession for not less than 5 years in India AND

·         Value of fixed Assets exceeds ₹50lacs.

Application form for Banking -           15C

Application form for other -    15D

      Remittances to Non-Residents U/S 195 and Information to be submitted

To monitor & track transactions in a timely manner Sec. 195 was amended in 2008 and 2 new forms were introduced

1.      Format of Undertaking:-                      15CA

2.      Format of certificate of Accountant:-  15CB

Process Flow chart of filing undertaking forms U/s 195

·    Remitter

·    Obtains certificate of Accountant 15CB

·    Access website www.tin.nsdl.com

·    Electronically upload the remittance details in form 15CA

·    Take print out of filed undertaking 15CA with system generated acknowledgement number

·    Sign 15CA

·    Submit the signed 15CA to RBI with certificate from accountant in duplicate

·    RBI Remits the Amount

·    A copy of 15CA & 15CB forwarded to AO

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