Major TCS Amendments applicable from 1st October 2020

  1. TCS on High Value sale of Goods – Section 206C (1H)

> Applicable on sellers of goods whose turnover exceeds INR 10 crores during the last year. This means that for the provision to be applicable during FY20-21, the sales should have exceeded INR 10 crores during FY19-20.

> TCS is to be collected from buyers whose aggregate purchase has exceeded INR 50 lakh during the previous year. TCS is to be collected only on sale above INR 50 lakh. This means that if the sale is made of INR 52 lakhs, the TCS is to be collected only on sale value of INR 2 lakhs.

>TCS is to be collected at the rate of 0.1%. However, if the buyer does not furnish PAN, the rate shall be 1%. (Till March 31, 2021, the rate shall be 0.075%)

>TCS is to be collected on receipt of amount (including advance payment)

>The collected TCS is to be deposited by the 7th of next month. This means that all the TCS collected in the month of October 2020 has to be deposited by 7th November 2020.

> The TCS return (form 27EQ) has to be submitted on a quarterly basis.

Exclusions

>Goods are exported out of India.
>Where TDS is collected by the buyer on such sale.
>Where the buyer is the Central Government, State Government, Embassy, A high Commission, Legation or trade representation of foreign state or a local authority.
> Goods on which TCS is collectible under other provisions.

  1. TCS on foreign remittances

> Any amount remitted outside India for buying foreign tour packages will attract TCS @ 5%.

> Any foreign remittance exceeding INR 7,00,000 will attract TCS @5%.

> However, in case of foreign remittances for education purposes, financed through loan, TCS will be levies at 0.5% for amount exceeding INR 7,00,000.

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