20% TDS on international transactions

Rajkotian wrote:
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:

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.

Let me ask you few counter questions paji

- IT know that all politicians are hiding real income, why no action against them?
- if you think a 15 lakh vehicle is luxury then please google which cars are luxury saloons and check teambhp you will see which income class is buying what category of vehicles
- how will this 20% tcs on all transactions lead to more and correct it filings?
- please explain the above question from an economic pov too
- maybe not all but certainly people who have a bit financial education are investing outside. I think @kochiro will agree. Oh wait should we skip microsoft and invest in cowsoft now?
- counter to your counter, why do all those mncs and investors use usd to invest in india? Biggest counter, what is our country's economy number? 2-4 trillion dollars? Great, but why this draconian law to stop its citizens from investing in companies worth 200 trillion plus dollars?

getready wrote:

Thread title needs a change. This is for outward remittances

Edit: Seems tcs applicable on online/offline debit/credit/forex card payments too (with few exceptions like Medical and education)

thank god education is spared! #ache_din 😄

kshmr wrote:
thank god education is spared! #ache_din 😄

20% isn't there but old slab remains intact. 0.5% TCS for education loan, 5% for other reasons (above 7L per FY)

Kochiro wrote:

Especially if you are trading in cryptos and other investment apps.

nope, there are several ways to convert to crypto  without paying a dime scam tds. you just need to know ways

ex : p2p

kukdookoo wrote:
Paji russia pr lene ka kya process ha?

Russia to apna old friend hai.. India se direct connection hai. Aap direct Russian me deposit kr skte ho.

getready wrote:
20% isn't there but old slab remains intact. 0.5% TCS for education loan, 5% for other reasons (above 7L per FY)

7L threshold is kept only for education or medical reasons, no minimum threshold for rest.

Moneycontrol 

Rajkotian wrote:
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:

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.

In case you are wondering why people avoid paying taxes, Delhi gets around 0.3 paise for every 100 rs they pay as direct taxes.

kukdookoo wrote:
Let me ask you few counter questions paji

- IT know that all politicians are hiding real income, why no action against them?
- if you think a 15 lakh vehicle is luxury then please google which cars are luxury saloons and check teambhp you will see which income class is buying what category of vehicles
- how will this 20% tcs on all transactions lead to more and correct it filings?
- please explain the above question from an economic pov too
- maybe not all but certainly people who have a bit financial education are investing outside. I think @kochiro will agree. Oh wait should we skip microsoft and invest in cowsoft now?
- counter to your counter, why do all those mncs and investors use usd to invest in india? Biggest counter, what is our country's economy number? 2-4 trillion dollars? Great, but why this draconian law to stop its citizens from investing in companies worth 200 trillion plus dollars?

I think he needs to see this video to understand how much paying taxes is really benefiting us.

Seinfeld wrote:

7L threshold is kept only for education or medical reasons, no minimum threshold for rest.

Moneycontrol 

That's what i've been saying since the beginning. The updated rules don't apply to Education and Medical remittances 

Thanks, @kukdookoo Bhai, for tagging me.

I tried my best, but these terminologies and rates are very difficult for me to understand.

I just want to know from the knowledgeable Dimers involved in this topic _ whether the cost of hosting and domains is going to increase or not.. as @Seinfeld Bro mentioned.

Even transferring funds for professional and educational purposes TDS will ve deducted?

Snapz wrote:
Russia to apna old friend hai.. India se direct connection hai. Aap direct Russian me deposit kr skte ho.

Very good returns if we deposit there.

Kochiro wrote:

I think he needs to see this video to understand how much paying taxes is really benefiting us.

I wouldn't recommend these influencers but paji needs to think rationally

kapaalaa wrote:
Thanks, @kukdookoo Bhai, for tagging me.

I tried my best, but these terminologies and rates are very difficult for me to understand.

I just want to know from the knowledgeable Dimers involved in this topic _ whether the cost of hosting and domains is going to increase or not.. as @Seinfeld Bro mentioned.

It shouldn't, @getready and @Seinfeld paji 20% tcs is only if u remit money thru banks or apps. If you are paying via payment gateway then there is no tcs, as per the notification released till today.

kukdookoo wrote:
It shouldn't, @getready and @Seinfeld paji 20% tcs is only if u remit money thru banks or apps. If you are paying via payment gateway then there is no tcs, as per the notification released till today.

Could be. Lets wait until July to see what happens. Like i said before, all these websites are posting their own versions/assumptions and i doubt any active dimer here spent 7L on a single international e-commerce transaction / even aggregate post Oct 1, 2020

This is the exact statement from Budget speech

The rate of TCS for foreign remittances for education and for medical treatment is proposed to continue to be 5 per cent for remittances in excess of ` 7 lakh. Similarly, the rate of TCS on foreign remittances for the purpose of education through loan from financial institutions is proposed to continue to be 0.5 per cent in excess of `7 lakh. However, for foreign remittances for other purposes under LRS and purchase of overseas tour program, it is proposed to increase the rates of TCS from 5 per cent to 20 per cent.

and according to RBI, these are the purposes/reasons that come under LRS scheme

-

Edit: Full list of purposes can be found here (From Page 15). Imports (no explicit mention of e-commerce) and subscriptions are in the list 

kukdookoo wrote:
It shouldn't, @getready and @Seinfeld paji 20% tcs is only if u remit money thru banks or apps. If you are paying via payment gateway then there is no tcs, as per the notification released till today.

Thanks.. if this is so.. it will be very helpful

Kochiro wrote:

In case you are wondering why people avoid paying taxes, Delhi gets around 0.3 paise for every 100 rs they pay as direct taxes.

What you are comparing here is the data of Budget 2022-23. Every state has different needs and budget requirement, One Size doesn't fit all!
This is not a valid excuse to avoid paying the taxes.

kukdookoo wrote:
Let me ask you few counter questions paji

- IT know that all politicians are hiding real income, why no action against them?
- if you think a 15 lakh vehicle is luxury then please google which cars are luxury saloons and check teambhp you will see which income class is buying what category of vehicles
- how will this 20% tcs on all transactions lead to more and correct it filings?
- please explain the above question from an economic pov too
- maybe not all but certainly people who have a bit financial education are investing outside. I think @kochiro will agree. Oh wait should we skip microsoft and invest in cowsoft now?
- counter to your counter, why do all those mncs and investors use usd to invest in india? Biggest counter, what is our country's economy number? 2-4 trillion dollars? Great, but why this draconian law to stop its citizens from investing in companies worth 200 trillion plus dollars?

All these questions has answers, but this will lead us to an endless conversations. I think it's better to stop it here. 😉

@Kochiro @getready @Seinfeld @Snapz It's official only lrs not payment gateways, 2-4 things will have 5% above 7 lacs TCS rate for investment related overseas remittances through the Liberalized Remittance Scheme (LRS) is to be increased from 5% to 20% starting July 1, 2023.

kukdookoo wrote:
@Kochiro @getready @Seinfeld @Snapz It's official only lrs not payment gateways, 2-4 things will have 5% above 7 lacs TCS rate for investment related overseas remittances through the Liberalized Remittance Scheme (LRS) is to be increased from 5% to 20% starting July 1, 2023.

Meaning-less changes then, just complicating money routing / foreign investments for non-experts

kukdookoo wrote:
@Kochiro @getready @Seinfeld @Snapz It's official only lrs not payment gateways, 2-4 things will have 5% above 7 lacs TCS rate for investment related overseas remittances through the Liberalized Remittance Scheme (LRS) is to be increased from 5% to 20% starting July 1, 2023.

Thanks for the update, any links?

Rajkotian wrote:
What you are comparing here is the data of Budget 2022-23. Every state has different needs and budget requirement, One Size doesn't fit all!
This is not a valid excuse to avoid paying the taxes.

Bhai. Misuse of sacred words, misogyny, 24 x 7 complain ke liye reason thodina chahiye. Log dhund hi lenge apna apna reasons. 

Thanks for the thread. Firstly, as others suggested please mention in title it is on outward remittances which I think would make the scenario be clear  .

Also then LRS doesn't seem attractive anymore since it already has conversion charges, forex difference between buy and sell, bank charges etc.

Would buying via international MFs or ETFs listed on BSE/NSE be considered as foreign outward remits ? (Looks like not but wanted to know if anyone has idea)

No opinion per se on the taxing but just a thought that maybe now LRS isn't a good investment since it doesn't seem to be beneficial except for high value investments and long term profits.

Glad they kept the current rates at least for education and medical purposes

Seinfeld wrote:

Thanks for the update, any links?

https://www.livemint.com/money/personal-finance... @getready @Snapz @Ash-D @Kochiro A gaye pith pe vaar karne vale, sab ko galia dene vale kuch log yaha bhi. "Hum log thread me ladenge par dm me dost rahenege. Chalo uske thread ko downvote karo"

kukdookoo wrote:
https://www.livemint.com/money/personal-finance... @getready @Snapz @Ash-D @Kochiro A gaye pith pe vaar karne vale, sab ko galia dene vale kuch log yaha bhi. "Hum log thread me ladenge par dm me dost rahenege. Chalo uske thread ko downvote karo"

Nice article bhai.. Mint ka content quality gajab hai.

Simbha3 wrote:

wow. daylight robbery.

dont comment without understanding the topic.
plz explain how it is robbery?

What do the experts say?

According to Sanjeev Sachdeva, partner at Luthra and Luthra Law Offices India, it seems that the analysis of the Centre has been that high net individuals (HNIs) are using the LRS scheme to transfer large amounts outside India, but their income tax payments and compliances have not been commensurate.

"The proposal is intended to ensure that such persons have discharged their IT liabilities suitably," he said.

mysalemo771 wrote:

What do the experts say?

According to Sanjeev Sachdeva, partner at Luthra and Luthra Law Offices India, it seems that the analysis of the Centre has been that high net individuals (HNIs) are using the LRS scheme to transfer large amounts outside India, but their income tax payments and compliances have not been commensurate.

"The proposal is intended to ensure that such persons have discharged their IT liabilities suitably," he said.

This guy definitely doesn't sound like an expert. If center's target is HNIs alone, there's zero reasoning in removing the 7 Lakh threshold : 20% tcs applies to even 50K investment now and guess who will be affected by this? (HNIs / Experts always find ways)

getready wrote:
This guy definitely doesn't sound like an expert. If center's target is HNIs alone, there's zero reasoning in removing the 7 Lakh threshold : 20% tcs applies to even 50K investment now and guess who will be affected by this? (HNIs / Experts always find ways)

You can always get back that as refund if your taxable income is less
Its just one needs to file return and nothing wrong in it. If one can send money out means capable of filling return

mysalemo771 wrote:
You can always get back that as refund if your taxable income is less
Its just one needs to file return and nothing wrong in it. If one can send money out means capable of filling return

I didn't say filing IT returns is a wrong thing but this is unnecessary for low-income individuals (Less than basic exemption - 2.5l per year).. just makes things complicated for middle / lower middle class (+ 20% amount getting stuck for about an year, for some this could a lot)

TCS/TDS used to be 5% above 7L, they could've simply made this 20% if the government wants more focus on HNIs