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Withholding tax on foreign payments in India applies when payments are made by Indian entities to non-residents. Such payments are subject to tax deduction at source (TDS) under Indian tax laws and applicable DTAA provisions.
Our experts help businesses manage tax on payments to non-residents in India, ensuring correct tax rates, DTAA applicability, and full compliance with Indian regulations.
Proper cross border withholding tax planning in India helps businesses reduce TDS rates using treaty benefits.
Under Indian tax law, default withholding rates can be 10% to 20% or more. But through cross‑border withholding tax planning in India, we help you apply DTAA to:
With proper TRC, Form 10F, and No‑PE Declaration, we ensure treaty benefits are applied correctly.
Confusion about tax on payments to non‑residents India
DTAA rejected due to missing documents
High TDS deducted on software, royalty, or services
Delays in cross‑border payments
Disputes on whether PE exists
Notices for incorrect Section 195 TDS compliance
The #1 Choice for advisory for withholding tax under DTAA in India
Get complete clarity on TDS rules for different countries and industries — no more guesswork, no more confusion.
Not every payment needs the same documents or filings. We’ll help you separate the essentials from the nice-to-have, so you only do what’s required.
Learn how to legally reduce your TDS burden under DTAA — while ensuring smooth transactions with your overseas vendors and partners.
5 tax-saving strategies that most founders overlook, all 100% legal.
Free audit to see if you’re eligible for tax treaty benefits and how to apply them.
Never miss a deadline with this easy-to-follow month-by-month checklist.
check your residential status by your own
MAG helped us understand Indian tax rules on foreign payments, guided us on the correct withholding rate for cross-border transactions, and ensured no unnecessary tax was deducted in India. Their support saved us a huge cost.
MAG provided detailed advisory on taxation of technical fees received from India, which helped us successfully secure our refund from the department.
Before making cross-border payments, we were confused about process and documentation. MAG guided us, explained the need for 10F and NO PE certificates, and ensured compliance. Their expertise saved us from future trouble and gave us confidence in handling such transactions.
| Others | MAG |
|---|---|
| ❌ Apply flat TDS rates blindly (e.g., 10% everywhere) | ✅ Both Income Tax Act & DTAA reviewed for every payment |
| ❌ Miss critical documents → DTAA benefits denied later | ✅ TRC, Form 10F, No PE Declaration checked before advice |
| ❌ Same rate applied across all income types (risk of notices) | ✅ Step-by-step support for royalty, FTS, dividend, and interest payments |
| ❌ No opinion letters or certificates — client left to defend alone | ✅ Advisory notes, email formats, and Form 15CB and withholding tax planning included |
| ❌ No planning → refunds blocked, cash flow affected | ✅ Filing aligned with Form 15CA/CB and Section 195 requirements |
Get a Detailed Walkthrough on TDS for Cross-Border Payments — Explained, Simplified & 100% Compliant
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If the income is taxable in India or covered under Section 195 TDS compliance India, TDS must be deducted.
To apply lower TDS under a tax treaty, you must collect:
–TRC (Tax Residency Certificate)
-Form 10F
-No PE Declaration
We assist with reviewing and validating all documents before advising the rate.
Over-deducted TDS can delay vendor payments or cause working capital issues. The foreign recipient may struggle to claim refunds. We help you:
-Avoid over-deduction
-Apply for LDC (Lower Deduction Certificate) if applicable
-Ensure documentation is audit-proof
Yes. You must:
-File Form 15CA online
-Obtain Form 15CB (CA certificate, if required)
-Deposit TDS with the government
-Report in Form 27Q quarterly
We handle all filings for you, end to end.
You may face:
-Interest and penalties
-Disallowance of the expense in income tax calculation
-Scrutiny or notices from tax authorities
-MAG ensures you deduct the right amount at the right time — with proper justification.
Common examples include:
-Software license fees
-Royalty or subscription payments
-Payments to consultants or agencies abroad
-Management fees
-Interest payments
-Dividend distribution to foreign shareholders
We review each case individually.
Yes. We help with refunds, LDC applications, and DTAA corrections.
Yes. We provide:
-A TDS opinion letter if required
-Signed Form 15CB
-Filing proof for Form 15CA
-Summary of DTAA justification and tax position
Everything is tracked and stored for audit or remittance support.
Payments made by Indian entities to non-residents are subject to withholding tax in India if the income is taxable under Indian tax laws or applicable DTAA. The rate depends on the nature of payment and treaty eligibility.
Cross-border withholding tax planning in India ensures the correct tax rate is applied, prevents over-deduction or non-compliance, and aligns tax and FEMA requirements for inbound remittances.
Common mistakes include applying the wrong TDS rate, overlooking DTAA benefits, making remittances without proper tax analysis, and filing Form 15CA/15CB incorrectly. These mistakes can result in tax demands, penalties, and remittance delays.
Yes. If the recipient qualifies under the applicable Double Taxation Avoidance Agreement (DTAA) and provides the required documents, the withholding tax rate may be reduced compared to the standard rate under Indian tax laws.
The taxability depends on the nature of the payment, contractual terms, and applicable DTAA provisions. A proper withholding tax analysis should be conducted before making the payment to determine the correct TDS treatment.
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