How to apply arms license in India?

Non-India vendor sells software license to India business. Is it subject to TDS? If so, why?

  • I would think if TDS was taken on a Non-India vendor, that would infer the Non-India vendor must file an India tax return to get any portion of their money back, if they are not otherwise required to file India income taxes (no Nexus).

  • Answer:

    Buying and selling of software licences may attract purchase or sales tax but not TDS. There is no provision in the Indian Income Tax Act, 1961 to deduct tax while selling products. If the non-Indian vendor had his offices in India, then, sales tax registration would be called for and will be subject to the Act and Rules prevalent in that state.

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