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KnackChap

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9 minutes ago, Bird Bird Bird said:

Also is 20% TDS in foreign remittances over and above the prevailing tax slab ? :huh:

Sorry, it's TCS and not TDS.

 

You pay tax on your income.

You use this post-tax income to remit money abroad.

You pay 20% as TCS over and above.

You adjust this 20% in ITR.

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Just now, KunjanPSD said:

Sorry, it's TCS and not TDS.

 

You pay tax on your income.

You use this post-tax income to remit money abroad.

You pay 20% as TCS over and above.

You adjust this 20% in ITR.

 

But that's money remittance. How do they collect tax for spends abroad with DC ? Like you do a swipe for 1L internationally using Fi. How would TCS be charged ?

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12 minutes ago, Bird Bird Bird said:

 

But that's money remittance. How do they collect tax for spends abroad with DC ? Like you do a swipe for 1L internationally using Fi. How would TCS be charged ?

Just like they were charging 5% post 7L spend before?

Fi used to deduct 5% extra of spent amount on every txn and at the end of the day if your annual remittance was less than 7L, they used to refund it.

But then I think they moved to the Niyo model, basically keep a spend count and if spend went above 7L in an year, start charging 5%.

Now they will charge 20% at every txn.

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Obviously, a lot of clarifications are needed here. I hope CCs are left alone.

Think about reimbursements? You spend on your personal card and ask for reimbursement from corporate. Will they reimburse you that extra 20% or will leave you to wait out for tax adjustment? Fun.

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12 minutes ago, KunjanPSD said:

Obviously, a lot of clarifications are needed here. I hope CCs are left alone.

Think about reimbursements? You spend on your personal card and ask for reimbursement from corporate. Will they reimburse you that extra 20% or will leave you to wait out for tax adjustment? Fun.

 

What a clusterf**k ! 

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1 hour ago, Bird Bird Bird said:

Also is 20% TDS in foreign remittances over and above the prevailing tax slab ? :huh:

 

1 hour ago, KunjanPSD said:

Sorry, it's TCS and not TDS.

 

You pay tax on your income.

You use this post-tax income to remit money abroad.

You pay 20% as TCS over and above.

You adjust this 20% in ITR.

Basically, 20% TCS will be deducted when we send money abroad for investment, then we need to get the TCS deduction certificate, then claim TCS tax credit while filing ITR.

 

2 implications:

1) irritation of these additional steps of claiming tax credit 

2) govt can keep track of all such remittances, which it already does when we file required forms for remittances. In such forms, you have to specify the purpose which can be overseas equity investments and also which stocks like Apple for example

 

is my interpretation correct?

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8 minutes ago, 0verlord said:

 

Basically, 20% TCS will be deducted when we send money abroad for investment, then we need to get the TCS deduction certificate, then claim TCS tax credit while filing ITR.

 

2 implications:

1) irritation of these additional steps of claiming tax credit 

2) govt can keep track of all such remittances, which it already does when we file required forms for remittances. In such forms, you have to specify the purpose which can be overseas equity investments and also which stocks like Apple for example

 

is my interpretation correct?

Yes.

Everything like Vested/Groww etc etc will be affected.

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16 minutes ago, 0verlord said:

 

Basically, 20% TCS will be deducted when we send money abroad for investment, then we need to get the TCS deduction certificate, then claim TCS tax credit while filing ITR.

 

2 implications:

1) irritation of these additional steps of claiming tax credit 

2) govt can keep track of all such remittances, which it already does when we file required forms for remittances. In such forms, you have to specify the purpose which can be overseas equity investments and also which stocks like Apple for example

 

is my interpretation correct?

 

7 minutes ago, KunjanPSD said:

Yes.

Everything like Vested/Groww etc etc will be affected.

 

How does this impact use of DC/CC internationally ? Do these neobanks like Fi send TCS certificates like traditional bank ? Certificate on demand etc ?

 

Edit: Lets see if this passes muster. Hoping there will be enough sh*t storm to put a threshold. 

Edited by Bird Bird Bird
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1 hour ago, Bird Bird Bird said:

 

 

How does this impact use of DC/CC internationally ? Do these neobanks like Fi send TCS certificates like traditional bank ? Certificate on demand etc ?

 

Edit: Lets see if this passes muster. Hoping there will be enough sh*t storm to put a threshold. 

CC is still up for confusion.

They all will have to give TCS certificate. Fi and Niyo do give these.

 

I am hoping, this really falls on its face.

Otherwise, buy forex in cash from India will rule again.

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1 minute ago, Bird Bird Bird said:

 

We don't matter. The tour operators and financial companies need to create a sh*t storm. 

 

 

For me, remittances are for US equity investments and I use a bank to make the remittance to my broker 

 

The bank already has systems in place to deduct and process TDS 

 

only problem is I as a customer will have to pony up more ₹ to remit the same $ and the increased ₹ will come back to me in a roundabout fashion without any interest on it - an increased “working capital” situation for me - major impact, while the bank will have less impact as I am double less business with them but will continue to do - so the bank may not have high incentive to create a sh*t storm

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