Tax Collected at Source (TCS) is an additional amount collected as tax by a seller of specified goods from the buyer at the time of sale over and above the sale amount, which is then remitted to the government account. Here are some key points about TCS:
- TCS is applicable on all LRS (Liberalized Remittance Scheme) transactions, including international debit card transactions.
- It is governed by Section 206C of the Income-tax Act, which specifies the goods on which the seller has to collect tax from the buyers.
- The seller must collect TCS from the buyer at the time of debiting the amount payable to the buyer’s account or at the time of receipt of such amount from the said buyer by any mode, whichever is earlier.
- The TCS rates and applicability can vary based on the total turnover and sale consideration received by the seller in the previous financial year.
- TCS is payable by the seller who collects it from the lessee or buyer, and the goods on which TCS is applicable are specified under section 206C of the Income-tax Act.
In summary, TCS is a tax collected by the seller from the buyer on certain specified goods at the time of sale, and it is then remitted to the government account.
