Tax collected at source (TCS) is the tax collected by the seller from the buyer on sale and deposited with the tax authorities. Section 206C of the Income-tax act governs the goods on which the seller has to collect tax from the buyers. Such persons must have the Tax Collection Account Number (TAN) to be able to collect TCS.
The tax payable is collected by the seller at the point of sale. The rate of TCS is different for goods specified under different categories
| Type of Goods or transactions | Rate |
|---|---|
| Liquor of alcoholic nature, made for consumption by humans | 1% |
| Timber wood under a forest leased | 2.5% |
| Tendu leaves | 5% |
| Timber wood by any other mode than forest leased | 2.5% |
| Forest produces other than Tendu leaves and timber | 2.5% |
| Scrap | 1% |
| Minerals like lignite, coal and iron ore | 1% |
| Purchase of Motor vehicle exceeding Rs.10 Lakhs | 1% |
| Parking lot, Toll Plaza and Mining and Quarrying | 2% |
| Where total turnover of seller is more than Rs.10 crores in the previous financial year and receives sale consideration of any products of more than Rs. 50 lakhs, such seller must collect TCS upon receiving consideration from the buyer on such amount over and above Rs.50 lakhs, as per Section 206C(IH). (Without PAN, then 1% is TCS) | 0.1% |
TCS is not liable to be collected in case of goods purchased for personal consumption except in case of motor vehicles.
The following persons are liable to collect TCS from the buyer on sale:
Filing income tax returns
Chapter VIA deductions
Capital gains taxation
Taxation of business
NRI income
GST returns and due dates
Input tax credit claim
GST Refund
GST TCS
GST TDS
NRI Income