TAX COLLECTION AT SOURCE(TCS) PROVISIONS & TCS RATES

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Dear Friends ,
we have generally learn about tds (Tax Deducted at source ) but as per section 206C ,tax is to collected on sale also ,the concept of TDS and TCS is to get tax collected from the assessee so that he must be assessed under the Income tax act and scope of the income tax can be widened.In this post I have try to explain the main provisions relating to Tax collected at Source i.e TCS.

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
  1. The Central And State Government.
  2. Local authority
  3. Statutory corporation or Authority
  4. Company
  5. Firm
  6. Co-operative society
  7. 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
  1. Public sector company,
  2. Central/state Government,
  3. Embassy,a high commission,legation,consulate and the trade representation of a foreign state and
  4. A club
  5. A buyer in the retail sale of such goods purchased for personal consumption
so goods purchased by consumers are not covered under TCS

Specified Goods
  1. Alcoholic Liquor for human consumption
  2. Tendu Leaves
  3. Timber obtained under a forest lease
  4. Timber obtained by any other mode
  5. 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.
  6. 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.
When tax has to be collected.
  • 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.
Tax Rate
  1. Alcoholic Liquor for human consumption:one percent(1%)
  2. Tendu Leaves(five percent,5%)
  3. Timber obtained under a forest lease:(two and half percent,2.5 %)
  4. Timber obtained by any other mode:(two and half percent,2.5 %)
  5. Any other forest produce not being a Timber or tendu leave::(two and half percent,2.5 %)
  6. Scrap::one percent(1%)
plus surcharge(if applicable) 10 %on basic rate given above
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.
Exemption/Nil rate.
  • 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 .
Tax deduction & collection Account Number:(TDCAN better known as TAN)
  • 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.
Issue of Tax collection certificate to Buyer.

  • 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.
Return
  • 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
Return on computer media(e TCS return) following person are required to file mandatory return on computer media known as e-TCS return.other person may filled their return on manual basic.
  • 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.


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SECURITIES (MNP) (TDS)2007-08 ` 01.07.12 01.09.2008 01.10.2012 06.07.2009 07.08.2012 1 PERCENT EXCISE ITEMS LIST 1 sep 1% excise 10 year nsc 10(10C) 1000 court cases judgements supplied to ITO 1000 rupee note 11-2008 11-2010 130 items 14.08.2008 15 august 150 Rs coin 15g 15h 18-12-2009 192(1A) 192A 194 I 194A 194c from 01.10.2009 194H 194j 194LC 1981-2007 2% cst 2% excise 2004 2008 2008-09 FY 2010 206AA 234A 234B 234C 234c interest calculator 234E 23AC 23ACA 23B 24C 24q annexure II 25 paisa coin 271(1)(c) 271B 271H 272B 27A 280 280 challan 281 282 283 29 AUGUST 29.04.2010. 29/08/2008 29/2008 service tax 2g meaning use 3 idiots 30 MARCH 31st March 32-2010 33 of 2009 35(2AA) 35(2AB) 3CD 3g meaning use 40(b) 43B 44 AB EXEMPTED INCOME 44AA 44AB AGRICULTURE 44AB new limit 44AB NON RESIDENT 44ad 46/2012 45/2012 49C 5 day week 5 years post office deposit 5/2011 50 paisa coin 54b 54EC 54ee 54f 54gb 5th paycommission punjab 6 % excise 6 crore advance limit 6/2005 69/2010 6th cpc 6TH PAY COMMISSION 70% of pan etds 7th Central Pay Commission 8 tips to save tax 80C 80ccc 80CCD 80cce 80CCF 80CCG 80d 80DDB 80EE 80G 80GG 80GGA 80GGB 80ggc 80tta 80U 85% of pan etds 86/2008 DATED 13-08-2008 87A rebate 89(1) 89(1) relief calculator 9.5 % rate for private epf 92E 95% of pan etds 98 dated 04/01/08 aadhaar aakash tablet aam admi aar Aayakar Sampark Kendra abatement abolished ACCOUNT PAYEE DRAFT Accounting ACCOUNTING CODE accounting code for services ACCOUNTING FOR GOVT GRANTS accounting standards ACES ADD IN Add-Ins additional relief in budget 2010 adjustment of advance FBT with advance Tax advance rullings advance salary ADVANCE TAX CALCULATOR advance tax challan ADVANCE TAX CUT OFF AMOUNT ADVANCE TAX DATES AFFIDAVIT AG Projects Technologies Ltd RT age 80 addition pension aibea wage revision aibea wage revision latest news aiboa aiboc aiboc wage revision AIG AIR airline ticket booking tds airlines all is well allowances allownces alphabet of inspiration alteration on check allowed alternate minimum tax AMENDED 3CD amendment in companies bill 2011 amendment in gratuity act 2010 amendment in registration service tax AMENDMENT IN SERVICE TAX ON RENT amendment to finance Bill 2010 AMNESTY SCHEME 2007 amt Anna Hazare anna hazzare bill vs govt lokpal bill appeal apply for new pan card against old pan card aqb arbitration arrears of salary arrears of sixth pay ARRERS TAX AS-12 ASBA assessee in default ASSESSMENT REOPENING ASSESSMENT YEAR 2008-09 REFUND atm atm 100 per day atm cash without card atm tips atm wrong debit audit cases itr filing audit limit enhanced Audit Questionaire AUDIT REPORT AUS VS IND.INDIA VS SL Automated teller machine AUTOMATION OF CENTRAL EXCISE AND SERVICE TAX ay 2010-11 bad debts Bank Bank account bank audit bank audit 2012 bank charges BANK SALARY bank strike 06/07/09 and 07/07/09 banking law amendment banknotes banks npa provisioning BARE ACT bare rules BASE RATE BY BANKS bcct BIMAL JAIN biometric pan card black and white form not 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capital asset capital formation huf Capital gain capital gain account scheme 1988 CAPITAL GAIN INDEX capital gain on repayment of loan capital gain on tenancy rights capital goods capital revenue CAPITAL SUBSIDY CAR LOAN RATE INCREASE carry forward of losses in late return cas cash flow statement CASH PAYMENT DIS ALLOWANCE CASH PAYMENTS EXCEEDING 20000 CASH SUBSIDY cbdt cbec CBI ARRESTED centeral sales tax rate CENTRAL PAY COMMISSION CENTRAL PROCESSING CENTER CENTRALISED PROCESSING OF RETURNS Cenvat CENVAT Credit Rules cgas 1988 challan challan 281 CHALLAN 289 challan correction challan Form 17 CHALLAN STATUS INQUIRY change change in cst rate change in excise duty rates CHANGE IN PAN ADDRESS CHANGE IN PAN DATA change in tds rates in budget changes CHANGES IN SERVICE TAX ACT changes in new itr forms CHANGES IN TDS CHARGES ON CASH PAYMENT OF CREDIT CARD BILL charitable organisation check name from PAN check tds deducted online Cheque cheque bounce cheque payment before due date cheque tender date /realisation date Cheque Truncation CHEQUE VALIDITY child care leave CHILD DEPENDENT PREMIUM CHILD MARRIED PREMIUM child plan childeren name children education allownces chip based atm card cibil cibil for companies CII 2007-08 CII 2008-09 CII 2010 cii 2012-13 CII2011-12 cin CIRCULAR 3/2010 DT 2.03.2010 CIRCULAR 8-2010 CIT v. Emilio Ruiz Berdejo (2010) 320 ITR 190 (Bom.) cloning of atm card clubbing of income COLLECTION CHARGES COLOR SCHEME COMMISSION ON SMALL SAVINGS common error in 2009-10 common error in itr 4-5-6 compa companies bill 2012 COMPANIES RATE COMPANY BILL 2011 company deposit Company Law Settlement Scheme COMPANY REGISTRATION complusory payment of taxes Composition scheme service tax COMPUTER AS FAX MACHINE computer sytem at ito office CONCEPT PAPER configure yahoo mail in outlook express consolidate account statement construction purchase of house Consultancy Service Consumer Price Index continues services CONTRIBUTION TO NEW PENSION SCHEME CONTRIBUTORY PENSION FUND CONVERT FIGURES INTO WORD EXCEL COPARCENER CorpMcash corporation bank correction etds CORRECTION IN PAN DATA correction in section CORRECTION RETURN CORRECTION RETURN.ETDS cost accounting cost audit cost inflation index cost inflation index 2012-13 COST INFLATION INDEX FY 2010-11 COST INFLATION INDEX FY 2011-12 COST OF INDEXATION CALCULATOR court case in entry tax punjab cpc phone number cpf Credit card CREDIT CARD BILL PAYMENT ICICI BANK credit scores cricket team critical illness CROSSED DEMAND DRAFT CRR crr reducred CS DIVESH GOYAL CST CST 3% OR 2 % cst act 1956 cst form CST FORM STATUS cst rate changed CST REDUCE RATE ctt currency CURRENCY TRADING ILLEGAL custom custom changes in budget cusual leave DA MERGE da rate da rate 01.07.2012 da rate january 2013 da rate july 2012 da rate wef 01.01.2012 date extension DDO ASK RENT RECIPT ddt dearness allowance Debit card DEBT EQUITY RATIO debt funds debt trap declared goods DEDUCTION 80C deduction for higher studies deduction on saving bank interst deduction u/s 80DD Deemed income of employee deemed services defective return defence officers defence pay defence pay scales DELAY IN FILING delete ledger in tally DELHI HIGH COURT demat deposit tax of two quarter in single challan depreciation depreciation on car depreciation on commercial vehicle. DEPRECIATION ON INTANGIBLE ASSETS depreciation rate depreciation rate 2009-10 DETAIL AFTER E FILLING DETAIL OF TIN Determination of value DIFFRENT TYPE OF TAXES digital signature din direct payment in bank account DIRECT SUBSIDY direct tax bill direct tax changes in budget direct tax code direct tax code 2009 Disability insurance discussion Paper distribution of salary dividend distribution tax dividend striping dnd do not call. document identification number document ientification number documents required for service tax registration domestic transfer pricing donation dot double taxation dow jones download download 89(1) relief calculator download direct tax code 2012 download form 16A download fvu download idfc INFRA BONDS FORM draft reply drawback rates dtaa dtc DUE DATE AY 2010-11 due date ay 2011-12 due date extended due date extended to 31.08.2012. due date for service tax return due date form 16 due date form 16a due date June due date march tax due date of return 2008-09 due date pf esi due date to deposit tds DUE DATES DUE DATES CALENDAR DUE DATES CALENDER DUE DATES INCOME TAX DUE DATES SERVICE TAX DUE FAMILY PENSION DULICATE PAN DUPLICATE TAN dvat e book Income Tax rules e book on service tax E ERA OF TAXES e filing do and don'ts e filing of audit report e filing processing status e filing software excel free e filing through evc e filing utilities e mode for notice to shareholder e notice to share holder e payment of epf E PAYMENT OF EXCISE DUTY e payment of income tax E PAYMENT OF SERVICE TAX e payment of tds E STAMP DUTY e tutorial for TAN registration E-1 FORM E-1 SALE e-commerce E-FILE SERVICE TAX RETURN e-Intermediary e-payment from friends account E-PAYMENT OF SERVICE TAX e-payment of taxes E-SEVA BY ICAI e-TDS/TCS statements earn from home earned leave Easy Exit Scheme ebay EBOOK EBOOK ON SERVICE TAX economic survey economic survey 2010 economic survey 2011 economic survey 2012 Edible Oils EDITABLE INCOME TAX FORM education cess EDUCATION LOAN eet EFFECTIVE DATE CST RATE REDUCTION effective date of allowncs efiling errors efiling free efiling income tax return efiling of excise return