TaxTMI 
TaxTMI 
Please guide that payment (remittence in foreign currency) by an indian telecom company to a foreign telecom company for roaming charges of its customers against usage in there network outside india is liable to TDS or not and if yes then at what rate.
Tds applicability for payment in foreign remittance
20 Oct 2009 
2 Replies 
8593 Views Asked by
TDS applicability on foreign roaming remittances depends on taxability, treaty relief and permanent establishment status.
TDS applicability on foreign remittances for roaming charges depends on whether the payments are taxable in India, their correct legal characterisation, and whether treaty provisions or a permanent establishment affect taxing rights and withholding obligations. Domestic decisions finding that interconnection charges were not subject to withholding do not automatically control cross border remittances; a fact specific assessment of characterization, recipient residency, treaty relief and the applicable withholding rate is required. (AI Summary)
TDS applicability on foreign remittances for roaming charges depends on whether the payments are taxable in India, their correct legal characterisation, and whether treaty provisions or a permanent establishment affect taxing rights and withholding obligations. Domestic decisions finding that interconnection charges were not subject to withholding do not automatically control cross border remittances; a fact specific assessment of characterization, recipient residency, treaty relief and the applicable withholding rate is required. (AI Summary)