TDS U/s 195 on payment to Foreign Engineer for Consulting Fees

[Rahul Patel]

Dear Sir,

Professional Consultancy Charges is payable to an Foreign Engineer Consultancy For Consulting Fees.

the consulting is not having PAN No.

Please guide applicable TDS rate as per DTAA & as per Income Tax act. on above payment.

Regards,

Rahul Patel

AI Summary

Clarification sought on TDS rate under Section 195 for foreign consulting fees; discrepancy between 20% and 25% rates. A query was raised regarding the applicable Tax Deducted at Source (TDS) rate under Section 195 for consulting fees paid to a foreign engineer without a PAN. The individual initially deducted and deposited TDS at 20%, but the TDS return was rejected by the Income Tax Department, which indicated a 25% rate was applicable. The individual seeks clarification on whether any notification has been issued by the Income Tax Department regarding this discrepancy.