Credit Card holders may have to file declaration with banks for TCS Levy
PrintListen to this Article
The I-T department is in talks with the RBI and other stakeholders to firm up a mechanism for distinguishing whether the expense is towards medical/education which attract a 5 per cent TCS or for other purposes on which a 20 per cent Tax Collection at Source (TCS) would be levied, they added.
According to sources, discussions are veering around giving additional time to taxpayers for filing declaration to the credit card issuer bank specifying the nature of expenditure from July 1 - the date from which the new TCS proposal will come into force.
The tax department will issue a detailed FAQ on modalities for levy of TCS at the specified rate.
Beginning next month, overseas expenses on credit cards exceeding Rs 7 lakh will be subject to a 20 per cent TCS. However, if such expenses is incurred for medical or educational purpose, the TCS would be levied at 5 per cent. For those availing loans for overseas education, a lower TCS rate of 0.5 pr cent would be levied above the Rs 7-lakh threshold.
The Union Budget 2023-24 had hiked TCS rates to 20 per cent, from 5 per cent currently, on overseas tour packages and funds remitted under LRS (other than for education and medical purposes). The new tax rates will come into effect from July 1, 2023.
In May, the government brought changes to the FEMA Current Account Transaction Rules and included overseas credit card expenses in the ambit of LRS (Liberalised Remittance Scheme), under which a resident can remit money abroad up to a maximum of USD 2.50 lakh per annum. Beyond the threshold, RBI approval would be required.
The changes in FEMA rules effectively brought credit card spends under the ambit of TCS.
Following concerns raised by public, the finance ministry on May 19 issued a clarification that any payments by an individual using their international debit or credit cards up to Rs 7 lakh per financial year will be excluded from the LRS limits and hence, will not attract any TCS. Detailed clarity on the issue is still awaited.
Category : International Business | Comments : 0 | Hits : 673
Chartered accountants from the UK and Canada might be allowed to practice in India on a reciprocal basis, with the apex body ICAI making the proposal to the Government. ICAI President Ranjeet Kumar Agarwal, on February 21, said the proposal will be implemented strictly on the reciprocal basis that chartered accountants (CAs) from India will also be allowed to practice in the United Kingdom and Canada. It will be the first time that overseas CAs will be allowed to practice in India. The pro...
Concerns have been raised about the applicability of Tax Collection at Source (TCS) to small transactions under the Liberalized Remittance Scheme (LRS) from July 1, 2023. To avoid any procedural ambiguity, it has been decided that any payments by an individual using their international Debit or Credit cards upto Rs 7 lakh per financial year will be excluded from the LRS limits and hence, will not attract any TCS. Existing beneficial TCS treatment for education and health payments will also co...
The ministry on May 16 notified the Foreign Exchange Management (Current Account Transactions) (Amendment) Rules, 2023, to include international credit card payments in the LRS. Any remittance beyond USD 2.5 lakh or its equivalent in foreign currency would require approval from the RBI. Earlier, the usage of international credit cards (ICCs) for making payments for fulfilling expenses during travel outside India was not included in the LRS limit. According to the notification, the Finance ...
Canada’s immigration minister Sean Fraser has announced Express Entry invitations to FSWP and CEC candidates will resume by “early July 2022” The vast majority of new Express Entry applications will be processed within the six-month service standard. According to IRCC, current Express Entry processing times range from seven months to in excess of 20 months. Summary of Canada's Immigration Levels Plan Each year, the federal department of Immigration, Refugees ...
Canada’s Provincial Nominee Programs (PNP) issued over 3,400 invitations to apply for provincial nomination during the month of August. Canada’s Provincial Nominee Programs (PNP) issued over 3,400 invitations to apply for provincial nomination during the month of August 2021. Major Provinces are.. Saskatchewan, British Columbia, Ontario, Alberta, Manitoba, Prince Edward Island. Nearly every Canadian province and territory, except Quebec and Nunavut, operates its own Provincial...
Comments