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    TDS on purchase of goods: buyer withholding required, with precedence rules to avoid overlap with other withholding provisions.
    Clause 393(1)[Table: S.No. 8(ii)] imposes a TDS obligation on the buyer to deduct tax on purchases of goods from resident sellers once aggregate purchases from a seller in a financial year exceed the specified threshold, with deduction due at credit or payment, and a broad exclusionary clause preventing application where tax is deductible or collectible under any other provision of the Act.
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    TDS on specified senior citizens centralises tax deduction at banks, relieving return filing when tax is correctly deducted at source.
    Specified banks are required to compute a specified senior citizen's total income after allowing Chapter VIII deductions and rebate, deduct tax at rates in force with a nil threshold, and remit TDS; an express precedence clause ensures this provision overrides other TDS provisions. The mechanism centralises compliance with banks obtaining declarations, maintaining evidence and records, thereby relieving eligible senior citizens from return filing provided the bank correctly applies deductions and remits tax.
    Act RulesBills
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    TDS on e-commerce: operators must withhold on gross platform-facilitated sales, with a small-seller exemption on conditions.
    E-commerce operators must withhold TDS on the gross amount of sales or services facilitated through their platforms, with withholding due at the earlier of credit or payment and including direct buyer payments as deemed payments by the operator. Deductions apply on a gross basis without netting fees, exclude operator receipts for unrelated services such as advertising, and take precedence over other TDS provisions. Individual and HUF participants with annual turnover below the legislated threshold who furnish PAN or Aadhaar are exempt from withholding.
    Act RulesBills
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    TDS on large cash withdrawals: deduction at payment with exemptions for banks and regulated intermediaries, non filer rule absent here.
    Clause 393(3) requires banks, co operative societies engaged in banking and post offices to deduct two per cent TDS at the time of cash payment where aggregate withdrawals from one or more accounts of a recipient exceed prescribed thresholds, with a higher threshold for co operative societies; Clause 393(4) exempts payments to the Government, banks, post offices, regulated business correspondents and authorised white label ATM operators. The Bill mirrors the existing framework but, in the extracted text, omits an explicit non filer regime and express central government notification powers, creating potential operational and interpretive uncertainty.
    Act RulesBills
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    TDS on high-value payments by individuals/HUFs expands withholding obligations for contractual, professional and commission disbursements.
    Clause 393(1)[Table: S.No. 6(ii)] requires TDS by individuals or HUFs (not otherwise liable under specified TDS entries) on payments to a resident for carrying out work (including supply of labour), fees for professional services, or commission/brokerage (excluding insurance commission) where aggregate payments to the payee in a tax year exceed a prescribed threshold; deduction is at the time of credit or payment and the clause is integrated into a tabular TDS framework necessitating aggregation, with definitions and certain procedural relaxations left to rules or guidance.
    Act RulesBills
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    TDS on interest for foreign borrowings consolidated under new clause, keeping concessional framework but raising definitional and transition issues.
    Clause 393(2) consolidates concessional TDS treatment for interest to non residents on foreign currency borrowings, rupee denominated bonds and IFSC listed bonds, aligning mechanics and cut off windows with Section 194LC while differing in presentation and reliance on external definitions; Central Government approval remains a condition for specified instruments and drafting gaps on limits, definitions and transitional treatment may require subordinate rules to avoid interpretive disputes.
    Act RulesBills
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    TDS on securitisation trust distributions: uniform 10% for residents, treaty rates for non-residents, no threshold.
    Clause 393 mandates TDS on distributions by a securitisation trust: Clause 393(1) imposes 10% TDS on any income paid to resident investors with no threshold, deducted at the earlier of credit or payment by the trust; Clause 393(2) requires withholding on non-resident investors at rates in force, permitting treaty relief. Both provisions treat credits (including to suspense accounts) as TDS events and require trusts to maintain documentation of payee status and treaty claims.
    Act RulesBills
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    TDS on investment fund distributions: withholding applies, with treaty relief and exemptions for non taxable income.
    TDS on distributions by investment funds requires withholding at applicable resident and non resident rates at the earlier of credit or payment, excluding any portion of income that is statutorily exempt. Funds must determine and segregate taxable versus exempt portions of mixed income, apply treaty or domestic rates for non residents upon proper documentation, and maintain records to support exemptions or reduced rates, while coordinating these obligations with other TDS provisions to avoid double deduction.
    Act RulesBills
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    TDS on business trust distributions: differentiated resident/non resident rates and SPV contingent exemptions under the Income Tax Bill, 2025.
    Clause 393 of the Income Tax Bill, 2025 mandates 10% TDS on distributed income to resident unitholders, differentiated rates for non-resident unitholders (including lower rates for certain interest-type distributions and "rates in force" for others), and exempts specified distributions from TDS where the underlying SPV has not opted for the concessional tax regime, thereby tying withholding obligations to the SPV's tax-regime choice.
    Act RulesBills
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    TDS on infrastructure debt fund interest: concessional withholding retained for non-resident investors, deducted at credit or payment.
    Clause 393(2)[Table: S.No. 5] retains a concessional TDS regime for any income by way of interest paid by an infrastructure debt fund listed in Schedule VII to a non resident (including foreign companies), requiring deduction at source at the specified concessional rate at the earlier of credit or payment, with no monetary threshold, and integrated within the Bill's harmonised TDS framework that addresses procedural rules, exceptions, grossing up, and interaction with double taxation treaties.
    Act RulesBills
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    TDS on land acquisition compensation maintained; threshold and RFCTLARR Act exemptions preserved, procedural consolidation introduced.
    Clause 393 of the Income Tax Bill, 2025 mandates TDS at 10% on any sum in the nature of compensation or enhanced compensation, or consideration or enhanced consideration, for compulsory acquisition of immovable property (other than agricultural land), when amounts paid or credited to a resident exceed Rs. 5,00,000 in a financial year; Clause 393(4) exempts awards or agreements exempt from income-tax under the RFCTLARR Act, and deduction is required at the earlier of payment or credit.
    Act RulesBills
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    TDS on mutual fund distributions: withholding required at source with exclusion for capital gains, subject to threshold rules.
    Clause 393 consolidates TDS on income from units of specified mutual funds and analogous instruments, requiring deduction by any payer at the prescribed rate at the time of credit or payment, subject to an aggregate threshold, while expressly excluding receipts that are of the nature of capital gains; the provision retains deeming rules for suspense accounts and links to cross referenced exemptions and schedules for definitions, thereby centralising administrative obligations and necessitating payer systems to characterise payments and aggregate receipts for threshold application.
    Act RulesBills
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    TDS on professional and technical services clarified: consolidated rates, threshold and personal-payment exemption streamline withholding obligations.
    Clause 393(1) requires TDS by a specified person on resident payments for professional services, technical services, director's fees (non-salary), royalty and related sums, with distinct lower rates for certain technical, cinematographic and call-centre payments and a higher rate for other cases, deductible at the earlier of payment or credit and applicable only above the prescribed threshold. Clause 393(4) exempts individuals and HUFs from TDS where payments are made exclusively for personal purposes.
    Act RulesBills
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    TDS on monetary consideration under development agreements - deduction at credit or payment with no threshold.
    Clause 393(1)[Table: S.No. 3(ii)] requires TDS on any monetary consideration under agreements referred to in section 67(14), applying to any payer, excluding in-kind consideration, with deduction at the earlier of credit or payment, no monetary threshold, and an explicit rule that where both general immovable property TDS and S.No. 3(ii) apply, deduction is to be made only under S.No. 3(ii).
    Act RulesBills
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    TDS on rent expanded to include equipment and furnished premises, increasing withholding scope and compliance for individuals and HUFs.
    Clause 393(3)[Table: S.No. 2(ii)] expands TDS on rent by subjecting payments for use of land, buildings, furniture, fittings, machinery, plant and equipment to withholding by specified persons where monthly payments exceed the threshold; it prescribes asset based rates and requires deduction at the earlier of credit or payment for the last month of the tax year or tenancy, while providing a declaration mechanism for nil deduction and procedural reliefs for small non business payers.
    Act RulesBills
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    TDS on immovable property transfers requires deduction on the higher of consideration or stamp duty value at payment or credit.
    Clause 393(1)[Table: S.No. 3(i)] requires TDS on transfers of immovable property (excluding agricultural land) where either the consideration or the stamp duty value exceeds the threshold. The transferee is the payer required to deduct tax at a fixed percentage of the higher of consideration or stamp duty value, with deduction at the time of credit or payment. Aggregation of amounts across multiple transferees and transferors applies, and the table provides tie breaker rules and specific exclusions such as compulsory acquisition.
    Act RulesBills
    Show AI Summary
    TDS on rent: payer-based uniform and differentiated withholding alters withholding obligations and REIT exemption treatment.
    Clause 393 requires TDS on rent to residents where monthly rent exceeds the threshold, with deduction at the earlier of credit or payment. Non-specified payers withhold at a uniform low rate for all asset types, while specified persons withhold at differentiated rates for machinery/plant/equipment versus land/building/furniture/fittings. The Bill maintains an exemption from TDS for payments to REITs in respect of directly owned real estate assets and preserves rules treating suspense-account credits as payment for withholding purposes.
    Act RulesBills
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    TDS on commission and brokerage: Bill preserves current threshold and rate and maintains targeted exemptions for telecom franchisees.
    Clause 393(1) mandates that a specified person deduct TDS at two percent on resident commission or brokerage payments (excluding insurance commission) when aggregate payments exceed the statutory threshold, with deduction at the earlier of credit or payment and anti avoidance deeming for suspense accounts. Clause 393(4) preserves a targeted exemption for certain telecom franchisee payments, maintaining continuity with existing sectoral relief and reducing compliance burdens.
    Act RulesBills
    Show AI Summary
    TDS on lottery-related payments: unified withholding on commissions and prizes with harmonized threshold and deduction rate.
    Clause 393(3)[Table: S.No. 4] consolidates TDS on payments to persons engaged in stocking, distributing, purchasing or selling lottery tickets, requiring any person making payments of commission, remuneration or prize to deduct tax at the earlier of credit or payment; it includes a deeming fiction treating credits to suspense or intermediary accounts as credit to the payee and imposes standard deductor duties of deposit, certification and return-filing, while leaving aggregation rules and characterization of complex incentive structures unclear.
    Act RulesBills
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    TDS on national savings withdrawals: mandatory deduction at source with defined threshold and exemptions for individuals and heirs.
    Clause 393(3)[Table: S.No. 6] requires any person responsible for paying amounts referred to in section 80CCA(2)(a) to deduct income-tax at the rate of 10% at the time of payment where the amount or aggregate amount paid during the tax year exceeds Rs. 2,500; the Table under sub-section (4), Sl. No. 19, exempts payments made to an assessee who is an individual and to the heirs of an assessee, and payers must deposit TDS, file returns, and issue certificates in accordance with the procedural framework.

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      Comparison of section 511 "Furnishing of report in respect of international group." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

      17 September, 2025

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      Section 511 Furnishing of report in respect of international group

      Income-tax Act, 2025

      At a Glance

      The document reproduces Clause 511 - Income Tax Bill, 2025 - Old Version, setting out reporting obligations for constituent entities of international groups (country-by-country reporting style). It matters for multinational groups with Indian resident constituent entities - both taxpayers (resident constituent entities, parent entities, alternate reporting entities) and the tax administration. Effective date or commencement is Not stated in the document.

      Background & Scope

      Statutory hooks: Clause 511 sits within miscellaneous provisions of the Income Tax Bill, 2025 and proposes a standalone reporting obligation for "international groups". The clause creates duties to notify the prescribed income-tax authority and to furnish reports containing consolidated and constituent-level financial and operational information. Definitions and scope are provided within the clause itself. Any subordinate rules, forms, timelines and thresholds are to be set out "as prescribed" (delegated rule-making).

      Statutory Provision Mode

      Text & Scope

      Clause 511 imposes three principal obligations:

      • Notification (sub-section (1)): Every constituent entity resident in India that is part of an international group whose parent is not resident in India must notify the prescribed income-tax authority in the prescribed form and manner by the prescribed date whether it is the alternate reporting entity and/or provide details of the parent or alternate reporting entity and their jurisdictions.
      • Reporting (sub-section (2)): Every parent entity or alternate reporting entity resident in India must, for each reporting accounting year, furnish a report to the prescribed income-tax authority within twelve months from the end of that reporting accounting year, in the prescribed form and manner.
      • Fallback reporting (sub-section (4)): Where an Indian resident constituent entity is not the parent/alternate reporting entity, it must furnish the report within a prescribed period if the parent is resident in a jurisdiction that (a) is not obligated to file such a report; (b) lacks an agreement with India for exchange of the report; or (c) has experienced a "systemic failure" and that failure has been intimated by the prescribed income-tax authority.
      • Sub-sections (3) and (6) detail report content and exceptions; (7) grants the authority the power to issue notices and require supporting information; (8) provides a consolidated-revenue threshold exemption; and (9) permits application "as prescribed".

      Interpretation

      The text indicates a legislative intent to implement a country-by-country reporting regime targeted at large international groups with constituent entities resident in India. The use of express definitions (e.g., "consolidated financial statement", "parent entity", "constituent entity", "reporting accounting year") demonstrates an intent to align reporting obligations with financial reporting and with international standards for transfer pricing transparency. Several interpretive principles are signalled by the text: alignment with parent-jurisdiction financial periods, deference to prescribed forms and procedures, and reliance on intergovernmental agreements for automatic exchange.

      Exceptions/Provisos

      Key carve-outs and conditions:

      • Threshold exemption (sub-section (8)): The section will not apply if the total consolidated group revenue for the preceding accounting year does not exceed the prescribed amount - the specific monetary threshold is Not stated in the document.
      • Non-application where an alternate reporting entity files in its jurisdiction and certain conditions are met (sub-section (6)): Conditions include the foreign report being required by local law, presence of an exchange agreement between that country and India, absence of any systemic failure communicated by the Indian authority, written designation of the alternate reporting entity, and prior notification under sub-section (1). These are cumulative preconditions.
      • Fallback allocation where multiple Indian resident constituent entities exist (sub-section (5)): If more than one Indian constituent entity exists, any one designated entity may furnish the report provided the group has designated that entity and the information has been conveyed in writing to the prescribed authority.

      Illustrations

      • Example 1: A multinational group with a non-resident parent and one Indian subsidiary that is designated as the alternate reporting entity must notify the income-tax authority in India and, if resident as alternate reporting entity, file the report within 12 months of the reporting accounting year end. (All procedural details - forms/timelines - are Not stated in the document.)
      • Example 2: An Indian permanent establishment (PE) of a foreign enterprise that prepares separate financial statements as a PE falls within "constituent entity" and, if the foreign parent's jurisdiction neither files nor exchanges reports with India, that Indian PE may be required to furnish the report within the prescribed period. (Precise prescribed period is Not stated in the document.)

      Interplay

      The clause expressly contemplates interaction with:

      • Section 159(1) or (2) (via the definition of "agreement") - signalling reliance on specified intergovernmental agreements for exchange.
      • Section 173(c) (for the meaning of "permanent establishment").
      • Prescribed rules/guidelines/conditions that remain to be issued for form, manner, dates and thresholds. The document does not reproduce any subordinate rules or forms. Specific interactions with existing transfer-pricing or information-exchange regimes are Not stated in the document beyond the express reference to agreements for exchange.

      Differences between the Document 1 "Section 511 of Income-tax Act, 2025" and Document 2 "Clause 511 - Income Tax Bill, 2025 - Old Version"

      • Prescription wording: Document 1 repeatedly uses the phrase "as may be prescribed" (e.g., sub-sects (1), (2), (3), (9)), whereas Document 2 often uses the shorter "as prescribed".
        • Practical impact: negligible substantive difference in content; "as may be prescribed" can imply delegation to subordinate legislation, while "as prescribed" is more neutral - both indicate delegated rule-making. In practice, stakeholders should expect rules/guidelines to be issued regardless.
      • Minor phrasing differences: e.g., Document 1 in sub-section (4)(c) reads "where there has been a systemic failure of the country or territory and such failure has been intimated by the prescribed income-tax authority to such constituent entity" while Document 2 reads "where there has been a systemic failure and such failure has been intimated by the prescribed income-tax authority to such constituent entity."
        • Practical impact: none substantive; the enacted text in Document 1 clarifies that the systemic failure is of the foreign country/territory, but Document 2's meaning would be read the same way in context.
      • Overall: there are no material substantive differences in obligations, definitions, thresholds or exceptions between the two texts provided. The principal practical impact arises from the change in status from a Bill clause (Document 2) to an enacted statutory section (Document 1) and minor drafting refinements that preserve the same legal obligations and delegated-rulemaking expectation.

      Practical Implications

      • Compliance and risk areas: Indian resident constituent entities of international groups must track whether their group's parent is resident outside India, determine whether they are designated as alternate reporting entity, and ensure timely notification to the prescribed income-tax authority. Parent or alternate reporting entities resident in India must prepare and file the prescribed report within 12 months of the reporting accounting year end. Failure to notify or file may expose entities to compliance actions under the Act and to information requests under sub-section (7).
      • Record-keeping/evidence: The text requires aggregated country-level financial and operational metrics and constituent-level details; accordingly, entities will need robust consolidated financial statements, country allocation methodologies, documentation of designation as alternate reporting entity, and written communications to the Indian authority. The precise content and format are "as prescribed" and therefore entities must monitor subordinate instruments for technical compliance requirements (not specified in the Bill text).

      Key Takeaways

      • Clause 511 establishes country-by-country style reporting obligations for international groups with Indian resident constituent entities.
      • There is a dual duty: initial notification by Indian resident constituent entities (where parent is non-resident) and annual reporting by Indian parent/alternate reporting entities within 12 months of reporting accounting year end.
      • Fallback reporting obligations apply to Indian resident constituent entities if the parent's jurisdiction does not file, does not exchange, or has a communicated systemic failure.
      • Exemptions hinge on a consolidated revenue threshold for the preceding year; the specific threshold is to be prescribed and is Not stated in the document.
      • The power to request supporting information and documents within defined timelines is provided to the prescribed income-tax authority.
      • Many operational details (form, manner, prescribed dates, exact thresholds) are left to delegated rules; stakeholders must monitor rule-making for compliance specifics.

      Full Text:

      Section 511 Furnishing of report in respect of international group

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      ActsIncome Tax