Section 206C(1G) — the law in short
What the courts have decided on section 206C(1G), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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Statutory position — s.206C(1G): TCS on LRS remittances and overseas tour packages as the sub-section stands from 1 April 2025
CBDT Circulars & InstructionsCuts both ways
My bank has collected TCS on the money I sent abroad for my daughter's university fees, and my travel agent has collected on the tour package. What does s.206C(1G) actually require, and at what rate and threshold?
Section 206C(1G) puts the collection duty on two people: an authorised dealer who receives an amount for remittance from a buyer remitting under the Reserve Bank's Liberalised Remittance Scheme, and a seller of an overseas tour programme package who receives any amount from the buyer of the package. The main charge is five per cent, collected at the time of debiting the amount payable by the buyer or at the time of receipt, whichever is earlier; the first proviso disapplies collection by an authorised dealer where the amount or aggregate of amounts remitted by a buyer in a financial year is less than ten lakh rupees, and the second proviso raises the rate to twenty per cent on the amount in excess of ten lakh rupees where the remittance is for purposes other than education or medical treatment.
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Statutory position — s.206CC: the higher TCS rate where the collectee gives no PAN, and the twenty per cent cap
CBDT Circulars & InstructionsCuts both ways
My buyer will not give me his PAN. At what rate do I have to collect, and is there any ceiling?
Section 206CC(1) requires a collectee to furnish his PAN to the collector, failing which tax is collected at the higher of twice the rate specified in the relevant provision and five per cent. A proviso caps the rate: 'the rate of tax collection at source under this section shall not exceed twenty per cent.' That cap matters most on s.206C(1G), where twice the twenty per cent rate would otherwise produce forty per cent.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.
