Applicability of Section 195

[JIGAR SHAH]

One of our clients is into tour operator business. They provide foreign tours. Further, they make payments to the foreign suppliers on behalf of their customers. For example they are making payments to hotels in Dubai and not deducting TDS on the same.

Is section 195 applicable to the them? If yes,why and if no why?

[SankaraNarayanan B]

https://www.taxtmi.com/forum/issue?id=1890

Please click the above link. One of our experts reply. If you have any query and for further clarifications kindly refer the DTAA

AI Summary

Section 195 applicability for payments to foreign suppliers may turn on taxability under applicable DTAA and expert advice.
The query asks whether withholding under Section 195 applies when a tour operator pays foreign suppliers (example: hotels in Dubai) on behalf of customers without deducting tax; the reply refers to an expert response via an external link and advises consulting the applicable DTAA for clarification of taxability and withholding obligations.