MAIN SECTION:Every person,being a seller ,shall collect tax at source(TCS) from the buyer of goods specified in section 206C(1).
Who is Seller?:
following persons are covered under the scope of the seller for TCS purpose
- The Central And State Government.
- Local authority
- Statutory corporation or Authority
- Co-operative society
- Individual or Hindu undivided family(HUF) if covered under section 44AB (mandatory Audit)
Who is Buyer ?
- Buyer Means a person who obtains in any sale,by way of auction,tender or any other mode,specified goods ,or right to receive any such goods
- but does not include
- Public sector company,
- Central/state Government,
- Embassy,a high commission,legation,consulate and the trade representation of a foreign state and
- A club
- A buyer in the retail sale of such goods purchased for personal consumption
- Alcoholic Liquor for human consumption
- Tendu Leaves
- Timber obtained under a forest lease
- Timber obtained by any other mode
- Any other forest produce not being a Timber or tendu leave:forest produce means grown spontaneously,though a latter stage human efforts are required /applied in order to extract the resultant product.TCS is applicable on Forest produce and not on agriculture produce.
- Scrap:means waste and scrap from the manufacture or mechanical working of material which is definitely not usable as such because of breakage ,cutting up,wear and other reasons.
- Tax(TCS) has to be collected at the time of debiting of the amount payable to buyer or at the time of receipt of payment,which ever is earlier.
- Alcoholic Liquor for human consumption:one percent(1%)
- Tendu Leaves(five percent,5%)
- Timber obtained under a forest lease:(two and half percent,2.5 %)
- Timber obtained by any other mode:(two and half percent,2.5 %)
- Any other forest produce not being a Timber or tendu leave::(two and half percent,2.5 %)
- Scrap::one percent(1%)
plus education cess 2 % on basic plus surcharge
plus secondary and higher education cess 1 % on basic plus surcharge amount
Tax collection at lower rate
- A buyer can apply to his Assessing Officer in Form 13 for tax collection at lower rate.
- on receiving application on Form 13 ,Assessing officer ,if satisfied,may issue such certificate directly to seller under advice to the buyer.This rates is applicable for a specific seller,who's name is given in the certificate and not applicable as blanket approval for purchase of specified goods from any body.
- No tax will be deducted from a buyer who purchases specified goods not for the purpose of trading but for the manufacturing,processing,or production of goods/article or thing.
- In this case Buyer gives a declaration, for above use, in duplicate in Form 27C to the seller.
- The seller shall deliver one copy ,form 27C collected from buyer, to Chief Commissioner/ Commissioner of Income tax .
- Every person collecting tax (TCS) at source shall apply in form 49B to the assessing officer.TAn(tax deduction account ) issued after 1.10.2004 are combined for TDS as well as TCS
- TDCAN/TAN should be written on all challan,return and TDS/TCS certificate issued .
- penalty for failure to obtain TDCAN is 10000 Rs.No penalty shall be imposed on the person if he proves that there was reasonable cause for the failure.
- If a person quote wrong Tan on a document where tan required to be quoted ,penalty may be imposed of rs 10000 u/s 273B for each occasion on which the default occurs.No penalty shall be imposed on the person if he proves that there was reasonable cause for the failure.
Deposit of Tax:
- Tax collected at source shall be deposited within one week from the last day of the month in which collection is made.
- To deposit TCS challan number 281 is to filled the same form is used for TDS also.
- The certificate shall be issued to the buyer on Form 27D with in one month from the end of the month during which amount is collected from the buyer.
- Consolidated form 27D may be issued for 6 months for transaction upto 30 September by 31 October and upto march 31 by April 30th on request from the buyer.
- The seller who has collected and deposited the TCS has to file a quarterly return on form 27EQ by 15july,15september,15january,30April for respective quarters
- if collector is a company or
- a person who's accounts are required to be audited u/s 44AB in immediately proceeding Financial year or
- where any quarterly return filled by the person in the immediately proceeding year has collector entries of more than or equal to fifty.
- other related topics
- INCONSISTENCY IN QTRLY ETDS/ETCS STATEMENT
- Register for form 26as (pan login)
- SIMPLE TAX INDIA -WELCOME
- ETDS 24 Q ANNE II SALARY REURN COLUMN HOW TO FILL.
- CORRECTION IN eTDS STATEMENT/RETURNS LESS DEDUCTION OF TAX.
- EMPLOYEE WORKING PART OF THE YEAR ETDS RETURN AND FORM 16
- FILL PAN OTHERWISE ETDS/ETCS RETURN WILL NOT BE ACCEPTED
- NEW RETURN TO BE FILLED BY ALL GOVT ACCOUNTS OFFICER
- SCOPE OF ETDS/ETCS STATEMENT ENHANCED