TCS Rates
The rates of TCS vary based on the transaction type and buyer’s compliance:
Rates for Specified Transactions
| Nature of Transaction | Standard Rate | Rate if PAN/Aadhaar not furnished |
|---|---|---|
| Sale of alcoholic liquor | 1% | 5% |
| Tendu leaves | 5% | 10% |
| Timber | 2% | 5% |
| Other forest produce, if obtained under a forest lease | 2% | 5% |
| Scrap | 1% | 5% |
| Minerals (coal, lignite, iron ore) | 1% | 5% |
| Parking lot/toll plaza/mine/quarry leasing | 2% | 5% |
| Specified luxury goods of value exceeding Rs. 10 lakhs | 1% | 5% |
| Remittances under LRS for education purposes or medical treatment | 5% | 10% |
| Remittances under LRS for other purposes | 20% | 20% |
| Overseas tour program package | 5% on remittance up to Rs. 10 lakh and 20% on the excess amount | 10% on remittance up to Rs. 10 lakh and 20% on the excess amount |
| Sale of goods exceeding Rs. 50 lakhs | 0.1% | 1% |
TCS on Sale of Alcoholic Liquor, Scrap, Forest Produce etc. [Section 206C(1)]
Who collects TCS?
Seller being:
- Central/State Govt
- Local authority
- Corporation/statutory body
- Company/firm/co-op society
- Individual/HUF (if turnover > Rs. 1 crore business / Rs. 50 lakh profession in prior FY)
From whom is TCS collected?
From the buyer, unless the buyer is:
- PSU
- Government
- Embassy/consulate/foreign trade rep
- Club
- Person buying for personal use (retail)
Other points
- Amount – TCS on full sales consideration.
- Time – At the earlier of receipt or account debit.
- Declaration (Form 27C) – No TCS if the buyer furnishes a declaration inForm 27C to the seller that the goods are for manufacturing/power generation (not trading). The seller submits a copy of Form 27C to the tax authorities by the 7th of the next month.
TCS on Leasing of Parking Lot, Toll Plaza, Mine or Quarry [Section 206C(1C)]
Who collects TCS?
Any person who grants lease, license, contract, or transfers right in parking lot, toll plaza, mine, or quarry.
From whom is TCS collected?
From the licensee/lessee using it for business purposes.
No TCS if lessee/licensee is a Public Sector Company.
On what amount TCS is collected?
TCS is collected on the entire amount received from the licensee/lessee.
When to collect TCS?
At the earlier of:
- Debiting the buyer’s account
- Receipt of payment
TCS on Sale of Motor Vehicle or Specified Luxury Goods (Section 206C(1F))
Who collects TCS?
Seller being:
- Central/State Govt
- Local authority
- Corporation/statutory body
- Company/firm/co-op society
- Individual/HUF (if turnover > Rs. 1 crore business / Rs. 50 lakh profession in prior FY)
From whom is TCS collected?
From Buyer paying > Rs.10 lakh for specified luxury goods, unless the buyer is:
- Central/State Government
- Embassy/Consulate
- Local authority
- PSU engaged in passenger transport
- Dealer/distributor of motor vehicles
- RBI
On what amount TCS is collected?
TCS is collected on the entire sales consideration if the value of each specified luxury good exceeds Rs. 10 lakh. The Rs. 10 lakh limit applies per item, not on aggregate yearly sales.
When to collect TCS?
TCS is collected at the time of receipt of payment, whether at the time of advance or at delivery.
TCS on Remittance under Liberalized Remittance Scheme (LRS) [Section 206C(1G)(a)]
Who Collects TCS?
TCS is collected by an authorised dealer (person authorised by RBI to deal in foreign exchange). The responsibility for collecting tax on remittances made under LRS lies with the authorized dealer, but the applicability of TCS is based on the remitter, not the authorized dealer.
From whom TCS is Collected?
TCS is collected from the remitter under LRS unless
- Amount of remittance < Rs. 10 lakh in the year
- Remittance is for overseas tour, and the seller has already collected TCS u/s206C(1G)(b)
- Remitter is a non-resident without PE in India
- Remittance is for education from a loan underSection 80E
- Remitter is Central/State Govt, Embassy, Consulate, Local Authority, or other notified person
- Payment made via international credit card while overseas
Amount on which TCS Applies
TCS applies on aggregate remittances exceeding Rs. 10 lakh in a financial year. The threshold applies across all purposes on a first-come-first-serve basis.
When to Collect TCS?
TCS is collected at the time of debiting the account or on receipt of payment, whichever is earlier.
TCS from Sale of Overseas Tour Package [Section 206C(1G)(b)]
Meaning of Overseas Tour Programme Package
- Any tour package that offers a visit to a country or territory outside India.
Includes:
o Expenses for travel,
o Hotel stay,
o Boarding/lodging,
o Other related or similar expenditures.
- CBDT clarification [Circular No. 10, dated 30-06-2023]:
Purchase of only an international ticket or only hotel stay is not covered. A package qualifies if it includes at least two of:
o International travel ticket,
o Hotel accommodation (with or without food)/boarding/lodging,
o Any other similar or related expenditure.
Who shall collect TCS
Seller of the overseas tour programme package.
From whom TCS shall be collected
Buyer purchasing the overseas tour programme package unless the buyer is:
- Central Government
- State Government
- Local Authority
- Embassy/High Commission/Consulate/Trade Representation of Foreign Government
- Non-resident without permanent establishment in India
- Any other notified person
Amount on which tax shall be collected
- TCS is collected on the total amount received by the seller for the overseas tour package.
- TCS applies on entire amount (even if purchase is via LRS).
Time of collection
At the time of debiting the amount or receipt of such sum, whichever is earlier.