[Dry Ice]

Clarifications have started coming in.

On the topic of vehicles above 10 lakhs, it's reduced to 0.75% now till Mar'21.

Check row 3.

[Aditya]

TCS on sale of vehicles above Rs. 10 lakhs reduced to 0.75% till Mar'21 - Post copied to a new thread.

[Shreyans_Jain]

You talk about paying lip service but this is paying lip service to lip service. How in the world will 0.25% going to be infinity stone that powers the sale of vehicles and get the auto sector back on track? Such announcements remind me of this:

[RaceHorse]

The need of hour is, lower GST rates for the automobile segment at least till the revival of the sector, and uniform road tax across all states.

This slight reduction in TCS, that too just for vehicles above 10 Lakhs will not boost the sales or have any long term benefits.

[Mr.RaghavDhir]

Originally Posted by Shreyans_Jain

You talk about paying lip service but this is paying lip service to lip service. How in the world will 0.25% going to be infinity stone that powers the sale of vehicles and get the auto sector back on track? Such announcements remind me of this:

Attachment 2005711

this also reminds me of my B-School days, leaving the role played by yours truly to your imagination

[anjan_c2007]

It is a mirage. A mere 0.25 % relief under an insignificant head. An eyewash and some bureaucratic jugglery by the lower level bureaucrats, who usually prepare such notes in multiple pages on files, to get these approved by the higher-ups. The higher-ups hardly have the time to go through all such fine print in the file, for which approval is accorded and it becomes official. Nevertheless, the jugglery is very much in tune with the likes and the thinking of the higher-ups.

[Rama Kumara]

Hi guys.

Had a query on this Tcs thing as I am not clear.
is there a possibility for me to claim this tax collection at source component while filing my income tax returns?

Are people in 30% income tax bracket eligible to claim back this as well?

[ashis89]

Originally Posted by Rama Kumara

Hi guys.

Had a query on this Tcs thing as I am not clear.
is there a possibility for me to claim this tax collection at source component while filing my income tax returns?

Are people in 30% income tax bracket eligible to claim back this as well?

Yes, this amount is paid by the dealer to the government against your PAN number. At the end of the FY, this amount will be adjusted against your total tax liability for the year. Anyone filing income tax would be eligible to claim/adjust this amount against their tax liability.

The effective cost of the car would be OTR price - TCS paid (as one would have paid the tax during ITR).

[Rama Kumara]

Originally Posted by ashis89

Yes, this amount is paid by the dealer to the government against your PAN number. At the end of the FY, this amount will be adjusted against your total tax liability for the year. Anyone filing income tax would be eligible to claim/adjust this amount against their tax liability.

The effective cost of the car would be OTR price - TCS paid (as one would have paid the tax during ITR).

Thank you so much Ashish, upvoted your comment.
Can people in the 30% bracket also claim the back as income tax refund?
Or is this only available for people who do not have any tax liability to the government.
Kindly advise!

[ashis89]

Originally Posted by Rama Kumara

Thank you so much Ashish, upvoted your comment.
Can people in the 30% bracket also claim the back as income tax refund?
Or is this only available for people who do not have any tax liability to the government.
Kindly advise!

Yes, people in 30% (and the lower ones too) bracket can claim it. In fact, it should directly appear on your Form 26AS like it did for me.

To your second question, after TDS let's say you have a tax liability of 'x' at the end of the year and your TCS is 'y', you have to pay x-y while filing your return. If x=0 or x-y is negative, then you get a refund. Hope that helps.

[shivshanker]

Originally Posted by Rama Kumara

Thank you so much Ashish, upvoted your comment.
Can people in the 30% bracket also claim the back as income tax refund?
Or is this only available for people who do not have any tax liability to the government.
Kindly advise!

Hi Rama Kumara, Tax Collection at Source is introduced even for LRS ( Liberalized Remittance Scheme), the Government is doing something good.

By the way, I was pleasantly surprised to see TCS on automobiles too. Guess the people who buy Luxury Cars now and do not pay taxes, will have to forgo a bit more cash now.

While I am not a CA, my late father was, I speak from my experience as I file IT Returns for me and my Wife.

1. Tax at Source is collected basis the established Rate (0.75%) during sale of the vehicle against a PAN Card.

2. As mentioned in other posts on this thread, this TCS credit will be shown against your PAN when you view your FORM 26AS. for the Financial Year (FY) you paid it.

3. For the sake of an argument, if I were to buy a new Car this FY, when my total income is Zero, the TCS will still need to be paid, else the car will not leave the showroom.

4. Now, under 26AS, there is an entry for Tax Collected at Source, however since I have Zero income, I will not fall under any slab of the IT Reckoner. This Tax Credit can be claimed as a refund, by filing IT Return for the respective Assessment Year (AY).

5. Similarly, irrespective of the income and the Tax Slab bracket, the above logic can be applied.

6. When there is income from Salary only, most probably you would get a refund, if your FORM 16 reflects al your deductions correctly.

7. Along with Salary income, if you have income from other sources such as FD and Speculative income, the TCS against the automobile purchase will be added to the overall Tax paid by you in the FY and either a refund or a demand for additional self assessment tax will be made, when you complete your IT returns form.

Hope this is clear now.

[Pancham]

Guys, can anyone confirm if the current TCS is 0.75% or 1%? I received a revised/new price schedule of Jeep from my SA and I could see it shows 1%.

[sahil624]

Originally Posted by Pancham

Guys, can anyone confirm if the current TCS is 0.75% or 1%? I received a revised/new price schedule of Jeep from my SA and I could see it shows 1%.

It’s 1% now. The 0.75% was only till March 2021 as a measure of relief during COVID last year.

[Ragavsr]

Instead of raising the TCS to the highest tax slab of 30 or 40 % to collect taxes from those evading income taxes but still somehow managing to buy expensive vehicles, the government comes up with such a stupid, regressive move.

Infact, the government should start collecting 30% TCS on all new cars , be it an Alto or Ferrari.

[GrandTourer]

Has there been any revision in the TCS yesterday? Was at the MG showroom with a friend to book the Hector, and the SA said there is a revision in TCS. He'll get back with the exact amount, but I couldn't find any news piece about the same.