TDS on sale and distribution of Fillms

[Guest]

Sale and distribution of films now included under royalty and hence TDS would be applicable. But the rate( 2% or 10%) is not clear after the amendment to Finance act 2020. Please refer below

As per the Finanace Act 2020,

In section 194J of the Income-tax Act, in sub-section (1),––

(a) in the long line, for the words “ten per cent. of such sum”, the words and brackets “two per cent. of such sum in case of fees for technical services (not being a professional services, or royalty where such royalty is in the nature of consideration for sale, distribution or exhibition of cinematographic films and ten per cent. of such sum in other cases,” shall be substituted;

So TDS for sale and distrubtion of films is now 2% or 10%. Please clarify

AI Summary

TDS Rate for Film Sales and Distribution Clarified: 10% Applies as Per Section 194J Amendment of Finance Act 2020. A query was raised regarding the applicable Tax Deducted at Source (TDS) rate on the sale and distribution of films, which are now classified under royalty. The confusion arose from the Finance Act 2020 amendment to section 194J of the Income-tax Act, which specifies a TDS rate of 2% for technical services and 10% for other cases. A response clarified that the 2% rate applies to technical services, while the 10% rate applies to other cases, including the sale and distribution of films.