TCS on sale of Goods – Are You Ready

Byefficpro

 

  • Effective from 1-10-2020, TCS will be applicable u/s. 206C (1H) of Income Tax Act where the seller (having turnover of more than 10cr. during FY. 19-20) receives any amount as consideration for sale of GOODS (in domestic market) in excess of 50 lakh from a single buyer.
  • TCS is to be collected on receipt basis irrespective of the invoice date
  • TCS is to be collected @0.10% (0.075% upto 31st March 2021) if PAN/ Aadhaar no. is furnished by the buyer else @1%.
  • TCS collected is to be deposited by 7th day of next month by the seller and a return 27EQ is to be filed on quarterly basis.
  • The aforesaid provision will not be applicable where the transaction of sale is already subject to TDS/TCS under other provisions of Act and buyer is government or local authority.
  • The seller needs to ensure that at the time of receipt of sale consideration, TCS amount is separately collected from the buyer. Else it will adversely affect the cash flow of the seller.

Disclaimer:

The purpose of this blog is for education purpose and should not be construed as professional advice. Views expressed herein are the personal views of the author. Government or judicial authorities may or may not subscribe to the views expressed herein. Author of the blog is not liable for any implications arising out of actions taken based on the views expressed herein.

 

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