Sub section (1H) to Section 206C of the Income Tax Act, which comes into effect w.e.f. 01-10-2020, is as follows:
"Every person, being a seller, who receives any amount as consideration for sale of any goods of the value or aggregate of such value exceeding fifty lakh rupees in any previous year, other than the goods being exported out of India or goods covered in sub-section (1) or sub-section (1F) or sub-section (1G) shall, at the time of receipt of such amount, collect from the buyer, a sum equal to 0.1 per cent of the sale consideration exceeding fifty lakh rupees as income-tax:"
"Buyer" for the purposes of this section means a person who purchases any goods, but does not include,
"Seller" for the purposes of this section means all types of assessees including Central Government, State Government, Local Authority, Municipal Corporation, etc., except individual and HUF. But where a seller is an Individual or HUF and his/its books of accounts are required to be audited u/s 44AB(a) or 44AB(b) during the financial year immediately preceding the financial year in which goods are sold, then TCS is required to be collected by such Individual/HUF.
A seller shall collect a sum equal to 0.1% of the sale consideration exceeding Rs. 50 lakhs
Where buyer can't provide PAN or Aadhaar Number to the seller TCS shall be collected @1% instead of 0.1%.
In case of TDS, tax is required to be deducted on value excluding GST, whereas under TCS, collection is required to be made on invoice value including GST (Relief granted vide Circular No. 01/2014 dated 13.01.2014 and as amended by Circular No. 23/2017 dated 19.07.2017 is only in respect of TDS and not for TCS);
TCS shall be collected by the seller at the time of receipt of sale consideration from buyer.
TCS collected during the month has to be deposited with the Government on or before the 7th of the following month.
TCS returns are to be filed quarterly on or before the 15th day of the month following the quarter.
The due date for depositing TCS for the month of March is 7th April unlike TDS which is to be deposited on or before 30th April.
In case of non-compliance Interest, late fee as applicable to default of TDS will apply to TCS as well.
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