TDS on Consaltancy fees paid to non-resident for rendering service outside India

[PANKAJ GUPTA]

Dear Sir,

We are manufacturing company and wantto engage a Person Mr. X as Consultant who is Indian Citizen and residing in USA on H4 Visa since last 1 year (Non-resident) for the export promotion in USA and develop overseas customer in USA. We will pay him a monthly Consultancy fees and also reimburse Conveyance bill on actual basis which incurred in USA for meet the overseas customer. He will provide all services in USA.He has Pan no. of India

Please confirm the TDS liability/ provisions in respect of payment of Consultancy fees and ConveyanceReimbursement to non- resident as per Income tax law andDTAA. Please also confirm whether this service will fall for Fees for Technical service (FTS) or not.

Regards

PankajGupta

M-09212401641

[Ganeshan Kalyani]

In my view Tds is deductive.

AI Summary

Manufacturing Company Must Deduct TDS on Consultancy Fees for Indian Citizen on H4 Visa Under Indian Tax Law and DTAA A manufacturing company plans to hire a consultant, an Indian citizen residing in the USA on an H4 visa, for export promotion and customer development in the USA. The company seeks clarification on the tax deduction at source (TDS) obligations for consultancy fees and conveyance reimbursement under Indian income tax law and the Double Taxation Avoidance Agreement (DTAA). They also inquire whether these services qualify as Fees for Technical Services (FTS). The response indicates that TDS is applicable.