TaxTMI 
TaxTMI 
Newly inserted Section 206AA requires every payee of sum which attract TDS, furnish PAN. Is it applicable to Non Resident Payee also. Suppose DTA rates is less than 20%, whether DTA rate Prevails or 20%?
Rate for DTA
10 Sep 2009 
2 Replies 
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PAN requirement under section 206AA can trigger higher TDS rates, affecting DTAA relief for non-resident payees.
The PAN-based withholding obligation applies when a payee fails to furnish PAN, including non-residents; in that event the payer must apply a higher statutory TDS rate, and only thereafter may DTAA provisions be examined with a view to applying the more favourable rate between the adjusted domestic withholding rate and the treaty rate. (AI Summary)
The PAN-based withholding obligation applies when a payee fails to furnish PAN, including non-residents; in that event the payer must apply a higher statutory TDS rate, and only thereafter may DTAA provisions be examined with a view to applying the more favourable rate between the adjusted domestic withholding rate and the treaty rate. (AI Summary)