TDS on Mobile and Telephone Payments

[PAWAN KUMAR SHARMA]

Dear All,

 

It has come to notice that persuant to change in definition of Royality as per Finance Act 2012, the payment of Mobile Bills, Broadband Charges, internet charges etc and Telephone Payments shall be after deduction TDS under section 194-J.

 

Need you views on the same.

 

AI Summary

TDS on telephone and internet payments: amendment to royalty definition creates withholding uncertainty, potential revenue challenge.
The Finance Act 2012 amendment to the definition of royalty creates uncertainty whether mobile, broadband and telephone payments are royalties or fees, but a preliminary view is that the withholding tax rule for fees for technical or professional services remains unchanged, while the amendment may affect withholding on cross-border payments and invite revenue challenges in the absence of board clarification.