TCS on Sales of Goods U/s Sec 206C(1H) | 17 Important Point

TCS on Sales of Goods U/s Sec 206C(1H) | 17 Important Point

1. It is applicable w.e.f. 1st October 2020 on the receipt basis

2. The responsibility to collect TCS, if gross turnover exceeds Rs. 10 Crores in PY  and If the sale consideration received from the buyer is exceeds  Rs. 50 lakhs

3. section 206C (1H) not applicable:- The Central Government may exempt certain entities from application of this section subject to conditions as may be specified.

4. section 206C (1H) not applicable:- In case of any Import into India or Export from India.

5. section 206C (1H) not applicable:- In case the transaction is covered by TDS under any other section.

6. section 206C (1H) not applicable:- In case goods being sold are covered by  sec 206C(1), Sec 206C(1F), Sec 206C(1G)  

7. section 206C (1H) not applicable:- Transactions in securities and commodities which are traded through recognized stock exchanges or cleared and settled by clearing corporations including recognized stock exchanges or recognized clearing corporations located in International Financial Service Centre.

8. section 206C (1H) not applicable:- Transaction in electricity, Renewal Energy Certificate and Energy Saving Certificate traded through power exchanges registered in accordance with Regulation 21 of the CERC.

9. section 206C (1H) not applicable:- Applicability on payment gateway and TDS is deducted by E-Commerce operator under Section 194(O). No TDS will be required under TCS on sale of goods.

10. section 206C (1H) not applicable:- Receipt by Insurance Agent on which TDS is deducted under Section 194(O).

11. section 206C (1H) not applicable:- Fuel supplied to non-resident air lines at Air Ports in India.

12. TCS Rate on Sales of Goods under sec 206C (1H)

PAN / AADHAAR furnishedUp to 31st March 2021From 1st April 2021
YES0.075%0.1%
NO0.75%1%

13. TCS  can be charged on tax invoice issued under GST Act :- seller is responsible to collect the TCS on consideration received by him on receipt basis, Seller needs to be charged on the invoice then only it will be recovered. Alternatively, after payment of TCS on the due date, separate invoice / debit note for TCS also can be raised. However, on the receipt of TCS no further TCS is required to be paid.

14. Adjustment of TCS :- It has been clarified by the CBDT Circular No. 17/2020 dtd. 29-09-2020 that, no adjustment on account of sales return, discount on indirect tax including GST is required to be made for collection of tax, since collection is made w.r.t. receipt of amount of sales consideration.

15. Payment of TCS by 7th of every month . ●

16. filing of quarterly return in Form 27EQ  within 15 days of the end of the quarter

17. Form 27D is the certificate issued for filing of TCS Returns within 15 days of the date of filing

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