Streamlining the procedure for obtaining authorisation for payment of sums to non-residents after deduction of tax at source under section 195(1) of the Income-tax Act, 1961

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....cepting interest on securities and income under the head "Salaries", is required to deduct tax at source at the rates in force. Such deduction should be made at the time of the credit of the income to the account of the payee or at the time of payment thereof, whichever is earlier. The proviso to section 195(1), however, lays down that in the case of interest payable by the Government or a public sector bank or a public financial institution within the meaning of section 10(23D) of the Act, deduction of tax at source will be made at the time of payment. 3. The Department of Economic Affairs, Ministry of Finance issued a Press Note dated May 17, 1988*, laying down the procedure for remittances to foreign companies by way of royalty and fe....

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....cation for authorisation is made will verify the claims of the payers in the light of the Income-tax Act, the Double Taxation Avoidance Agreements and the specific facts of the transactions, before authorising the remittance. (Sd.) Siddhartha Mukherjee, Secretary, Central Board of Direct Taxes.                                                 Application seeking authorisation for payments to non-resident [See section 195(1) of the Income-tax Act, 1961] Notes: 1. This application relates to payme....

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............................…….................................................................... being the person responsible for making this proposed payment request that I may be authorised to pay the sum mentioned at col. 3(b) to the non-resident mentioned at col. 4 after deduction of tax at the rate mentioned at col. 7 above. I declare that what is stated in this application is correct and complete. ........................................ Place :............ Signature Date :............. ........................................ Designation Authorisation for payment of sums to non-residents after deduction of tax at source under section 195(1) of the Income-tax Act, 1961 Income-tax Office, ................