Apr 28, 2012

TCS deduction is similar deduction as TDS

The purpose of section 206C is that the seller will collect tax from the purchaser in respect of sale of alcoholic liquor, forest timber, tendu leaves, scraps, etc., at the specified percentage as tax on income from dealing with these goods by the purchaser. This is similar to deduction of tax at source by the payer. Such tax collection at source is paid to the government on behalf of the purchasers of these goods.

• Such tax collected at source is to be treated on par with tax deductible at source and therefore should be taken into account while computing advance tax payable by purchaser of goods specified in section 206C.

• Credit should be given to TCS under section 206C from tax on assessed income to compute shortfall in payment of advance tax and for calculation of interest under section 234B - [2012] 20 taxmann.com 801 (Hyderabad - Trib.)
Tags-tcs deduction,tax collection at source deduction