[Dips]

Dear friends,
I have a question.

I purchased a Tata Nexon costing 10.39 lac Ex-showroom. Dealer quoted 1% TCS on it and accordingly the price was finalised. Incidentally, Tata Motors was running a promotional scheme of Rs.40,000 discount on insurance (which was originally quoted Rs.47,000). I paid total amount as per quotation, which included the Insurance @ 7,000.
So final car cost 10.39 + 1%TCS + RTO charges + 7K for discounted insurance.

After taking delivery of vehicle, I received the invoice from dealer. They did not apply 40,000 discount on insurance. It was billed at 47,000 but the car price was now shown on invoice as 9.99 lac. This means they applied discount on the car price rather than the insurance.
So it seems the dealer manipulated the discount such that he did not have to pay the 1% TCS, however, I had already paid him this amount as per original calculation.
My invoice does not show the TCS anywhere but the dealer has assured me he will provide a TCS certificate soon.

Am I right if I demand refund of the 1%TCS amount from him, if he fails to give me the TCS certificate, and hopefully I should not have any claims from IT Dept. later.

[MuzzledMoose]

Now it seems that TCS value to be taxed as per GST slab of automobile. We Indians need to keep paying too much taxes

https://www.indiatoday.in/amp/busine...320-2019-01-04

[realactivex]

How to claim the refund on the TCS paid?

[pogo0120]

Originally Posted by Dips

Am I right if I demand refund of the 1%TCS amount from him, if he fails to give me the TCS certificate, and hopefully I should not have any claims from IT Dept. later.

I saw this post today and thought I may answer, for records. I do have good experience in accounting due to companies I own.

If some one collects Rs xx as TCS, he has to deposit this amount against your PAN number to IT dept. Period. No questions, No excuse what so ever. (if Bangalore, bangalore circle account, if mysore, mysore and so on).

If I collect 1% TCS from you, for whatever purchase, sale or transaction, I have to deposit against your PAN number, within 30 days. Period. No questions, No excuse.

1% TCS is your money. It is not dealers money or any ones money. No one can collect TCS amount and keep to themselves.

Even if the price of the car is 9.99 lakhs or even if it is one lakh, 1% TCS CAN STILL be collected and deposited at IT dept against your PAN number. There is no rule, which says you cannot collect for 1 lakh car or sale of Rs 1 lakh item and not deposit TCS. This amount is used as a proof on your expenditure and the total taxation on your salary/income will be calculated upon financial year closure. You may get a refund or end up paying more based on your income slab.

Originally Posted by realactivex

How to claim the refund on the TCS paid?

Usually, you may not claim refund on this when you are buying cars worth 10 lakhs or 20 lakhs.

If you are buying cars at these price brackets, obviously, your income will be around 6 or 8 lakhs per annum, in which case you will be paying income tax on host of things. This amount will be adjusted in total tax paid during your tax filing. You may or may not get a refund.

On the other hand, assuming you are a salaried employee and you always pay exact income tax every month and there are no other gains like capital gains tax on property sale, share market, mutual funds, rental income, interest income, other income etc etc, then when you file your ITR returns, the software will detect that you have paid more tax than what was needed, in this case, the whole amount 1% TCS will be returned to your bank account linked to ITR.

To get refund, you will have to file income tax, which means, if you buy in last year April, you will have to wait till this year April to get refund.

[84.monsoon]

Originally Posted by realactivex

How to claim the refund on the TCS paid?

You will need to submit your tax return for the financial year and there, you can off-set the TCS paid agaist the tax you owe.


If you do not owe tax, you will still need to submit tax return and claim a refund. It will take years to get the money back!

[JithinR]

Originally Posted by Dips

So it seems the dealer manipulated the discount such that he did not have to pay the 1% TCS, however, I had already paid him this amount as per original calculation.
My invoice does not show the TCS anywhere but the dealer has assured me he will provide a TCS certificate soon.

Can you please let us know if the dealer provided you the TCS certificate?

I almost went for this promotional scheme sometime back. Didn't know dealers play with this amount too.

[itwasntme]

Originally Posted by 84.monsoon

If you do not owe tax, you will still need to submit tax return and claim a refund. It will take years to get the money back!

Certainly not in all cases! For salaried taxpayers the turnaround time for refund is 2-3 months IF there is no disparity, at least in BLR. I am unaware of those with combined incomes though.

[Dips]

To update on this TCS discussion, since the dealer did not provide me the TCS certificate, I escalated the matter to their accounting department and after few communications (and a strongly worded email), they agreed to refund the TCS amount collected from me. I got it adjusted in amount of extended warranty that I purchased from them. So all in all, finally there was no TCS paid by them so they returned back that amount to me.

[nagr22]

Originally Posted by Dips

To update on this TCS discussion, since the dealer did not provide me the TCS certificate, I escalated the matter to their accounting department and after few communications (and a strongly worded email), they agreed to refund the TCS amount collected from me. I got it adjusted in amount of extended warranty that I purchased from them. So all in all, finally there was no TCS paid by them so they returned back that amount to me.

Was the ex-showroom value above 10L? Then it is illegal to not deposit the TCS. You can check your form 26AS to see whether the dealer has deposited TCS. When I brought my car the dealer didn't give me any TCS receipt but within a week I could see the amount deposited against my PAN in form 26AS.

[Dips]

No, the ex-showroom value was just Rs. 100 short of 10 Lac!!. So thats how they played with the discounted price, trying to get me pay higher amount towards "TCS" but actually never had TCS applicable on base price.

[nagr22]

Originally Posted by Dips

No, the ex-showroom value was just Rs. 100 short of 10 Lac!!. So thats how they played with the discounted price, trying to get me pay higher amount towards "TCS" but actually never had TCS applicable on base price.

Thats interesting. My car too came below 10L ex-showroom after discounts but the dealer still made me pay full road tax and TCS citing the legality. I could also verify from KA RTO sources that irrespective of discounts one has to pay the full road tax. I assumed the same about TCS and anyways was not bothered to ask as I will be getting it back

[itwasntme]

Originally Posted by nagr22

Thats interesting. My car too came below 10L ex-showroom after discounts but the dealer still made me pay full road tax and TCS citing the legality. I could also verify from KA RTO sources that irrespective of discounts one has to pay the full road tax. I assumed the same about TCS and anyways was not bothered to ask as I will be getting it back

Your dealer is correct. In KA, the exshowroom price as filed formally by the manufacturer is sacrosanct. No amount of discounting will lower either the road tax or the TCS requirement. Only when the official exshowroom price is lowered and new price list filed with them, will the RTO take any cognizance.

This has happened because unscrupulous dealers were giving huge discounts on luxury vehicles (on paper) to lower the road taxes, yet collecting back the false discount provided in cash.

[Traveler]

Will the just announced 25% reduction in TCS rate impact the price of cars above 10 Lacs. Will the TCS levied now be .75% instead if the 1% that is levied now.

[Turbanator]

Originally Posted by Traveler

Will the just announced 25% reduction in TCS rate impact the price of cars above 10 Lacs. Will the TCS levied now be .75% instead if the 1% that is levied now.

Yes, for individuals. But, TCS is adjustable against your IT liability.

You can get refund for this amount or get it adjusted against your IT demand so this is not an additional tax and accordingly no Actual benefit ( small notional interest costs maybe)

[ObsessedByFIAT]

Originally Posted by Turbanator

Yes, for individuals. But, TCS is adjustable against your IT liability.

You can get refund for this amount or get it adjusted against your IT demand so this is not an additional tax and accordingly no Actual benefit ( small notional interest costs maybe)

This has always confused me. Sorry if I am going off topic, however, it would greatly help if you shed some light on :

- Can salaried people claim the TCS in their IT returns?
- If yes, under which section does this fall in?
- When you say 'Adjusted' what exactly does that mean?