How is tax deducted from Google or Facebook payments? The Act’s Explanation to Section 194C defines the term “work” to include “advertising.” Furthermore, a quick review of Section 194C of the Act discloses that any person responsible for paying any sum to any resident for performing any work in pursuance of a contract is required to deduct tax at source.The rules of Section 194C of the Income-tax Act would apply because there is a contract between the advertiser and Google/Facebook. A contract for an advertisement is covered by Section 194C. Google or Facebook publish advertisements in a variety of digital formats.Advertisements are published on digital media and payments are paid under a contract of advertisement between the payer/deductor and Google India or Facebook India.Deductors/payers are required to pay the entire bill amount to Google India or Facebook India.Īpplicability: TDS on payments made to Google India or Facebook India for Advertisement Expenses.When a payment is made to Google India or Facebook India for online advertisements and tax is deducted from such payment, the deductor must claim a refund of TDS from Google India or Facebook India because, in these cases, the deductor must first deposit the tax into the government’s account out of his own pocket and then claim credit or reimbursement from them.This is true whether you are registered with a Google entity registered in India or a Google entity registered outside of India. The GST rate for Google Adwords advertising is 18 percent.Advertisers that publish ads through a Google entity registered outside of India, on the other hand, will incur a slight loss since an equalization fee of 6% (also known as Google Tax) would apply if you promote through a Google entity registered outside of India.Regardless of whether they are advertising through a Google entity based outside India or through a Google entity situated in India, GST of 18% & TDS of 2% would apply in both cases. It’s crucial to highlight that some publishers are advertising through a Google corporation based in India, while others are advertising through a Google corporation based outside of India.Tax is deductible on such contributions under section 194C of the Income Tax Act, 1961 (“Act”), according to current Indian tax laws. In India, if a company publishes an advertisement on these digital platforms, Google India and Facebook India generate invoices.Google and Facebook, as we all know, are global companies. If someone wants to publish an advertisement on a digital platform, the first two names that come to mind are Google & Facebook.GST 18% & TDS 2 % can be deducted from the advertising cost of Google Ads.Ad Spends on entities registered outside of India are subject to a 6% equalization levy:Īll about the TDS & GST on Google or Facebook Ad words advertisements:.TDS Reimbursement Policy & TDS Certificates Policy on Facebook India:.How to claim TDS Refund from Facebook India?.Google India’s Policy on TDS Reimbursement & TDS Certificates:.How to get reimbursement of TDS from Google India?.The following illustration explains it.TDS of 2% on Google Adwords advertisements:.Google advertising registered from the outside India.Google advertising registered with the Indian entity.How is tax deducted from Google or Facebook payments?.Applicability: TDS on payments made to Google India or Facebook India for Advertisement Expenses.All about the TDS & GST on Google or Facebook Ad words advertisements:.
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