TCS (Tax Collected at Source)

TCS is a tax collection mechanism in which the seller of specified goods or services collects tax from the buyer at the time of sale. The seller then remits this tax to the government. This ensures that the government receives taxes at the point of transaction, and it serves as a safeguard against tax evasion. TCS is applicable to certain categories of transactions, such as the sale of specific goods (e.g., timber, scrap, etc.), foreign remittances, and online sales platforms. The collected tax amount is a percentage of the transaction value and varies based on the nature of the goods or service sold.

Key Points:

• The seller collects tax on the specified goods or services.
• The buyer is responsible for paying the tax amount at the time of transaction.
• TCS helps streamline tax collection and prevent evasion.
• Tax rates differ depending on the type of goods or service involved.
• The collected tax must be deposited with the government within a stipulated time.