Search Results For: commission


QUERY: A Ltd. is engaged in the business of running a call centre. The company also runs a training centre for people wanting to join call centre. The company has appointed through written contracts various franchisees to run training centres in various parts of the city. As per the terms of the contract, the franchisees collect training fees and after retaining certain amount towards recoupment of their cost and commission, remit balance amount to A Ltd. Is TDS applicable in such case? If so, on what amount and at what rate? How will this be practical since A Ltd. is not directly making any payment to the franchisees?
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S):
GENRE:
CATCH WORDS: , ,

– Theory of Principal and Agent would apply.

– A Ltd. – Principal in agreement with Franchisees

QUERY: XYZ is engaged in the business of manufacturing and export of various chemicals. It pays commission to various overseas agents, who procures orders for it from outside India. The Commission is payable only on actual export sales routed through the agents. The question is whether it is necessary to deduct tax at source under section 195 on export commission in view of withdrawals of circulars bearing no. 23 dated July 23,1969 and bearing no. 786 dated February 7, 2000.
ANSWER: Click here to read the full answer of the expert
EXPERT:
SECTION(S): , ,
GENRE:
CATCH WORDS: , ,

Even though, the circulars stated above have been withdrawn vide circular no. 7 of 2009 dated October 22,2009, no TDS is required to be deducted as no income is chargeable to tax under section 195 of the Income-tax Act, 1961, as non-resident selling agents have rendered the services outside India for procuring the orders and commission is payable to them outside India.