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20% TDS on international transactions

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Kochiro

Did banks start charging 20% TDS already or will it happen in April? I wonder why nobody is talking about it as it simply means if you invest 1000$ in US stocks, you will pay 200$ just to gov. Even if you try to keep track of international transactions to claim deductions, it will be a mess. We were worried about markup and now this. There is no lower limit on this 20% TDS so even if you do 1rs transaction, it will have 20% TDS.


Edit: Source : https://www.indmoney.com/articles/budget-2023-t...

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Benevolent Benevolent
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getready wrote:

Looks like the main intention here is to make people file IT returns. 7L threshold is gone and if you don't file IT returns and the TCS/TDS amounts to 50K+ for the last two years then this rate becomes doubled for future transactions (20 >> 40% vs 5 >> 10 until now)

No paji main intention is so that funds don't go outside from middle class.this is why the country is doomed.we cannot even invest the money like we want, modern gulaami.
Benevolent Benevolent
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Rajkotian wrote:
If we consider middle class household income range between 5Lac-15Lac per annum and they can spend/invest lacs of money after Foreign Trips/Shopping/Investment/etc. then why they can't file IT return?

This is TCS, if you are eligible, you will get the refund or adjusted as per you applicable Income Tax. This is not a loot by the Government.


Ours is a very incredible country, people here have jugaad (Makeshifter) for every law. Government is trying to close as much loopholes as possible. This change is not a concern/trouble for any common small citizen.

If you have spare 1 Lac Rs. to spend/invest in foreign, then be ready to pay 20K as TCS. Get the same adjusted in your IT return. IT Refunds are also very fast now a days. They do process it in 2-3 days only.
Paji ur definition of middle class between 5-15lacs is flawed, it does not consider inflation. From maruti 800 the middle class, upper, has shifted to the likes of creta so bear in inflation.
This draconian law has nothing to do with it filing, it is only to hold people away from investing outside so that money remains in the country.
I have 1 lac to invest i get my 20k blocked for atleast a year but i earn less than the taxable income. Will i be compensated for the interest on 20k? Tell me the name of one developed nation which has a law like this? Again i will have only 80% and for the rest government needs it and we can get it back after a year or so. Smh
And you need to introspect for a second, why are people interested in sending/spendint money abroad so much instead of doing the same in one's own country?
@getready @guest_999 @makdiman @kapaalaa @Ash-D @Snapz @magur @kochiro
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kukdookoo wrote:
Paji middle class ki mehangai aur aam zindagi khilaaf ladai koi nahi dekhta
If we consider middle class household income range between 5Lac-15Lac per annum and they can spend/invest lacs of money after Foreign Trips/Shopping/Investment/etc. then why they can't file IT return?

This is TCS, if you are eligible, you will get the refund or adjusted as per you applicable Income Tax. This is not a loot by the Government.


Ours is a very incredible country, people here have jugaad (Makeshifter) for every law. Government is trying to close as much loopholes as possible. This change is not a concern/trouble for any common small citizen.

If you have spare 1 Lac Rs. to spend/invest in foreign, then be ready to pay 20K as TCS. Get the same adjusted in your IT return. IT Refunds are also very fast now a days. They do process it in 2-3 days only.
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insta wrote:
still u can claim refund
how much? for less than 5 lac on old tax regime?
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Rajkotian wrote:
If we consider middle class household income range between 5Lac-15Lac per annum and they can spend/invest lacs of money after Foreign Trips/Shopping/Investment/etc. then why they can't file IT return?

This is TCS, if you are eligible, you will get the refund or adjusted as per you applicable Income Tax. This is not a loot by the Government.


Ours is a very incredible country, people here have jugaad (Makeshifter) for every law. Government is trying to close as much loopholes as possible. This change is not a concern/trouble for any common small citizen.

If you have spare 1 Lac Rs. to spend/invest in foreign, then be ready to pay 20K as TCS. Get the same adjusted in your IT return. IT Refunds are also very fast now a days. They do process it in 2-3 days only.
Then why not put a limit like TDS after 5L or 7L , its TDS even on 1 rs of international transaction.
Deal Cadet Deal Cadet
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Rajkotian wrote:
If we consider middle class household income range between 5Lac-15Lac per annum and they can spend/invest lacs of money after Foreign Trips/Shopping/Investment/etc. then why they can't file IT return?

This is TCS, if you are eligible, you will get the refund or adjusted as per you applicable Income Tax. This is not a loot by the Government.


Ours is a very incredible country, people here have jugaad (Makeshifter) for every law. Government is trying to close as much loopholes as possible. This change is not a concern/trouble for any common small citizen.

If you have spare 1 Lac Rs. to spend/invest in foreign, then be ready to pay 20K as TCS. Get the same adjusted in your IT return. IT Refunds are also very fast now a days. They do process it in 2-3 days only.
Disagree with govt. Is trying to close loopholes.

Govt is trying middle class se jitna ho sake lete raho aur free ki Rewari ration walo ko dete raho..every govt.tries to secure there votebank at the expense of middle working class
Generous Generous
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Kochiro wrote:
how much? for less than 5 lac on old tax regime?
Doesn't matter old or new,
This entire tcs is available for refund or credit against your tax liability
As per my understanding if u transfer 10lacs and pay 2lac tcs and then file itr below 5lac(or 7lac aa per new scheme) then u can claim refund of entire 2lacs tcs.
.
the tcs is being charged just to correlate how much income you actually show and how much outward remittances you do.
Critic Critic
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Kochiro wrote:
how much? for less than 5 lac on old tax regime?

Old or new doesn't matter, basically whatever tax you are getting to pay this tcs amt will be deducted from it & if any balance remain then it will be refunded. Tax payable is 20000(new or old tax system)-tcs(10000)=10000 tax payable AND 20000(old or new tax system)-tcs(25000)=5000 refund.

@kukdookoo

Deal Cadet Deal Cadet
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Kochiro wrote:
Then why not put a limit like TDS after 5L or 7L , its TDS even on 1 rs of international transaction.
you can adjust TCS with your total tax liability in ITR. It only affects people who don't file ITR and go on foreign tours 
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guest_999 wrote:

Old or new doesn't matter, basically whatever tax you are getting to pay this tcs amt will be deducted from it & if any balance remain then it will be refunded. Tax payable is 20000(new or old tax system)-tcs(10000)=10000 tax payable AND 20000(old or new tax system)-tcs(25000)=5000 refund.

@kukdookoo

need your help so I earn around 1 lac from international folks who pays through paypal. How much I will end up with from that amount?
Critic Critic
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Kochiro wrote:
need your help so I earn around 1 lac from international folks who pays through paypal. How much I will end up with from that amount?
Full amt, 20% tcs is when sending money abroad from India not when receiving money from abroad into India. Of course you need to pay tax on this amt after showing it in your income in itr.
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Yodaa wrote:
Disagree with govt. Is trying to close loopholes.

Govt is trying middle class se jitna ho sake lete raho aur free ki Rewari ration walo ko dete raho..every govt.tries to secure there votebank at the expense of middle working class
@Kochiro 

Where Govt. is taking anything from anyone/middle class?😂

This is TCS, File the IT return, If iyou are eligible for the refund, get your refund. If not it will be set offed with your tax liability.

Everyone does not do the transaction in foreign currency.

Regarding Loop Hole, It's very simple, Assume there is a limit of 7 Lac, Then how agencies/Bank will know whether you haven transacted over that limit or not? They can keep the record to them selves, but can't shared across the agencies.

i.e. One can spend 6.99 Lacs from different different accounts and never get caught!
Benevolent Benevolent
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Rajkotian wrote:
If we consider middle class household income range between 5Lac-15Lac per annum and they can spend/invest lacs of money after Foreign Trips/Shopping/Investment/etc. then why they can't file IT return?

This is TCS, if you are eligible, you will get the refund or adjusted as per you applicable Income Tax. This is not a loot by the Government.


Ours is a very incredible country, people here have jugaad (Makeshifter) for every law. Government is trying to close as much loopholes as possible. This change is not a concern/trouble for any common small citizen.

If you have spare 1 Lac Rs. to spend/invest in foreign, then be ready to pay 20K as TCS. Get the same adjusted in your IT return. IT Refunds are also very fast now a days. They do process it in 2-3 days only.
Paji ur definition of middle class between 5-15lacs is flawed, it does not consider inflation. From maruti 800 the middle class, upper, has shifted to the likes of creta so bear in inflation.
This draconian law has nothing to do with it filing, it is only to hold people away from investing outside so that money remains in the country.
I have 1 lac to invest i get my 20k blocked for atleast a year but i earn less than the taxable income. Will i be compensated for the interest on 20k? Tell me the name of one developed nation which has a law like this? Again i will have only 80% and for the rest government needs it and we can get it back after a year or so. Smh
And you need to introspect for a second, why are people interested in sending/spendint money abroad so much instead of doing the same in one's own country?
@getready @guest_999 @makdiman @kapaalaa @Ash-D @Snapz @magur @kochiro
Deal Lieutenant Deal Lieutenant
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Does this affect purchasing goods or services using foreign currency? Eg. Paying hosting / buying products from amazon.com etc.

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kukdookoo wrote:
Paji ur definition of middle class between 5-15lacs is flawed, it does not consider inflation. From maruti 800 the middle class, upper, has shifted to the likes of creta so bear in inflation.
This draconian law has nothing to do with it filing, it is only to hold people away from investing outside so that money remains in the country.
I have 1 lac to invest i get my 20k blocked for atleast a year but i earn less than the taxable income. Will i be compensated for the interest on 20k? Tell me the name of one developed nation which has a law like this? Again i will have only 80% and for the rest government needs it and we can get it back after a year or so. Smh
And you need to introspect for a second, why are people interested in sending/spendint money abroad so much instead of doing the same in one's own country?
@getready @guest_999 @makdiman @kapaalaa @Ash-D @Snapz @magur @kochiro

Paji, don't tag me anymore in such discussion. Not your fault but had bad experience due to a specific gang here who attacks if anyone voice an unpopular opinion (I'm not referring to abuses here), even another guy's non political/non abusive reply about financial service was removed.


Benevolent Benevolent
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Seinfeld wrote:

Does this affect purchasing goods or services using foreign currency? Eg. Paying hosting / buying products from amazon.com etc.

No
Mobile Guru Mobile Guru
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Seinfeld wrote:

Does this affect purchasing goods or services using foreign currency?* Eg. Paying hosting / buying products from amazon.com etc.

Think so or else this change makes no sense to me. Cards with Zero or minimal forex fee can be shipped to the target country for ATM cash withdrawals and POS transactions.

Deal Lieutenant Deal Lieutenant
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getready wrote:

Think so or else this change makes no sense to me. Cards with Zero or minimal forex fee can be shipped to the target country for ATM cash withdrawals and POS transactions.

Oh! I had thought whatever had 5% TCS will now have 20% TCS. 

If I buy 10 products from outside, pay their import duties and still pay 20% TCS, I will need to get proper documents to show them during IT filing. 
Already hosting/ domain name buying etc has GST included, which has inflated the price quite a lot and now this drama.

This is now getting challenging. They will be making life tough for honest tax paying citizens.

Anybody with good sources .. can you please confirm on this.
Critic Critic
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Seinfeld wrote:

Does this affect purchasing goods or services using foreign currency? Eg. Paying hosting / buying products from amazon.com etc.

Everything that involves sending foreign currency out of India is incl. Now prepay extra 20% on all such shopping txns & then wait for itr processing for it to be adjusted against your tax liability.
Generous Generous
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kukdookoo wrote:
To everyone having sip etc.outside India, + @EkdamSastaRaju i am pretty sure they will introduce a flat 15-25% tax on all foreign holdings soon so that we can only invest in atal pension yojna etc.
and Adani group stocks 😄
Deal Lieutenant Deal Lieutenant
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guest_999 wrote:
Everything that involves sending foreign currency out of India is incl. Now prepay extra 20% on all such shopping txns & then wait for itr processing for it to be adjusted against your tax liability.
Just wondering who will handle this, the bank during forex txns on credit card. They will provide us with TCS challans? Or the merchants, currently GST is handled by the merchants for indians buying or using their services.

If banks, then this is bound to increase the convenience fees. I am surprised why nobody is discussing this on twitter and elsewhere. Only LRS is being discussed.
Mobile Guru Mobile Guru
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Seinfeld wrote:
Oh! I had thought whatever had 5% TCS will now have 20% TCS. 

If I buy 10 products from outside, pay their import duties and still pay 20% TCS, I will need to get proper documents to show them during IT filing. 
Already hosting/ domain name buying etc has GST included, which has inflated the price quite a lot and now this drama.

This is now getting challenging. They will be making life tough for honest tax paying citizens.

Anybody with good sources .. can you please confirm on this.

Official details are missing but as per my understanding, this existing 5% TCS is also applicable on credit/debit/forex card purchases but only if the aggregate amount crosses 7L per annum. Our IT/Bank system is bad with aggregative calculation and many might've got lucky with even10L/20L yearly purchases (via multiple cards)

From july,23 there will be no 7L limit and the banks can charge 20% TCS for every transaction, issues Tax certificate for us to claim it back via Tax refund later.

Deal Lieutenant Deal Lieutenant
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getready wrote:

Official details are missing but as per my understanding, this existing 5% TCS is also applicable on credit/debit/forex card purchases but only if the aggregate amount crosses 7L per annum. Our IT/Bank system is bad with aggregative calculation and many might've got lucky with even10L/20L yearly purchases (via multiple cards)

From july,23 there will be no 7L limit and the banks can charge 20% TCS for every transaction, issues Tax certificate for us to claim it back via Tax refund later.

No bro, that 7L threshold has been removed in new budget.

Also a good read on this:
https://www.moneycontrol.com/news/business/budg...
"the proposal suggests that even a payment of $10 in foreign currency for app subscriptions or online services will be subject to TCS."
Critic Critic
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Seinfeld wrote:
Just wondering who will handle this, the bank during forex txns on credit card. They will provide us with TCS challans? Or the merchants, currently GST is handled by the merchants for indians buying or using their services.

If banks, then this is bound to increase the convenience fees. I am surprised why nobody is discussing this on twitter and elsewhere. Only LRS is being discussed.
It will be banks or more specifically, in case of CC they will put an extra debit entry of 20% in the statement(for debit cards it will be direct debit entry in savings acc). They will report all this to IT department so when you file your ITR you should see this 20% amt showing under "tds/tcs/advance tax paid" section.
Mobile Guru Mobile Guru
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Seinfeld wrote:
No bro, that 7L threshold has been removed in new budget.

Also a good read on this:
https://www.moneycontrol.com/news/business/budg...
"the proposal suggests that even a payment of $10 in foreign currency for app subscriptions or online services will be subject to TCS."
Yes, new rules will come into effect from July 2023. The first paragraph is about the current regime (Started from Oct 1, 2020 i suppose)
Generous Generous
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kukdookoo wrote:
Paji ur definition of middle class between 5-15lacs is flawed, it does not consider inflation. From maruti 800 the middle class, upper, has shifted to the likes of creta so bear in inflation.
This draconian law has nothing to do with it filing, it is only to hold people away from investing outside so that money remains in the country.
I have 1 lac to invest i get my 20k blocked for atleast a year but i earn less than the taxable income. Will i be compensated for the interest on 20k? Tell me the name of one developed nation which has a law like this? Again i will have only 80% and for the rest government needs it and we can get it back after a year or so. Smh
And you need to introspect for a second, why are people interested in sending/spendint money abroad so much instead of doing the same in one's own country?
@getready @guest_999 @makdiman @kapaalaa @Ash-D @Snapz @magur @kochiro
Paji sahab ne kia hai to kuch soch samjh ke hi kia hoga 🙏
Generous Generous
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Paji galat soch rhe ho.. @kukdookoo

Sahab chahte hai ki sare deshwasi paisa Swiss account me rakhe aur jab desh me lana ho to Adani ki tarah Mauritius se route kre. Nudge policy hai ye.. sabhi ko modern n smart banana chahte hain.

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kukdookoo wrote:
Paji ur definition of middle class between 5-15lacs is flawed, it does not consider inflation. From maruti 800 the middle class, upper, has shifted to the likes of creta so bear in inflation.
This draconian law has nothing to do with it filing, it is only to hold people away from investing outside so that money remains in the country.
I have 1 lac to invest i get my 20k blocked for atleast a year but i earn less than the taxable income. Will i be compensated for the interest on 20k? Tell me the name of one developed nation which has a law like this? Again i will have only 80% and for the rest government needs it and we can get it back after a year or so. Smh
And you need to introspect for a second, why are people interested in sending/spendint money abroad so much instead of doing the same in one's own country?
@getready @guest_999 @makdiman @kapaalaa @Ash-D @Snapz @magur @kochiro
Bro, Definition of Middle class can not be decided based on the show off and luxury expenses or the one's desires. We need to go through the actual data. Check this 2020 Data:

image


How many people are paying IT? What are the average Income? etc. many points to has to be considered.

In Developed country, most of the individuals do pay the higher taxes. India is a developing country, not a developed. And for every developing country it is very crucial to reserve the funds. Nothing wrong in that 😄
And again, as I told earlier, The idea here IMO is not to harass anyone, it is to close the loop holes by which many entities may be doing the tax evasion or sending/spending the money abroad.

Just think about the number of persons who might be engaged in such activities related to the foreign remittance? Do you think every middle class people are doing this? The number here will be very less.

Counter, Why there are so many FIIs, MNCs, Industries, Investors, VCs, all wants to Invest in India? 😂

Try to look it from a broader view.
Benevolent Benevolent
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Snapz wrote:
Paji sahab ne kia hai to kuch soch samjh ke hi kia hoga 🙏
Yeh sahab kaun ha parth? Apne mann ki baat khul ke kaho
Benevolent Benevolent
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Snapz wrote:

Paji galat soch rhe ho.. @kukdookoo

Sahab chahte hai ki sare deshwasi paisa Swiss account me rakhe aur jab desh me lana ho to Adani ki tarah Mauritius se route kre. Nudge policy hai ye.. sabhi ko modern n smart banana chahte hain.

Paji russia pr lene ka kya process ha?
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