New TCS Provision applicable from 01.10.20

New TCS provisions applicable from 01.10.2020

Precautions to be taken to implement New TCS Provisions
i. Update PAN of each and every customer whose sale consideration is expected to be more than Rs 50 lacs during the year. (Although w.e.f 1.01.2016 mentioning of PAN is mandatory in all invoices exceeding Rs 2 lacs)
ii. Categorisation of buyers into Central Govt, State Govt, local authority, embassy etc as in this cases TCS is not applicable.
iii. Digitization of accounting software to enable effective implementation of TCS provision.
iv. In the given case of sale of goods (other than tendu leaves, scrap etc) TCS need to be collected at the time of receipt of amount of consideration only. So no TCS need to be collected at the time of invoicing.
v. It appears that TCS need to be collected on the amount inclusive of indirect taxes. (Clarification from CBDT to be require in this matter)
vi. Proper reconciliation system should be in place where the invoicing and payment segregated in two financial years.
vii. TCS is not applicable in case buyer is liable to deduct TDS under any other section like 194C etc.

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