what is with holding tax

[RAJAT BAJPAI]

Dear Sir,

1. What is with holding tax?  2.  How are the rates of taxes applied under DTAA.

3 .How is the Taxable turnover determined for income tax purposes.

AI Summary

Understanding Withholding Tax and Taxable Turnover: Key Provisions Under Sections 195, 44AB, and 145A of Income Tax Act. Withholding tax refers to the tax deducted at source by the payer when making a payment to another party, commonly used in the context of overseas payments. Under section 195 of the Income Tax Act, this deduction is mandatory. The Double Taxation Avoidance Agreement (DTAA) provisions, which have an overriding effect, require understanding the agreement's scope and the nature of income involved to apply the most beneficial tax provisions. 'Taxable Turnover' is determined under section 44AB and section 145A of the Income Tax Act, requiring adherence to general accounting principles.