Help me learn Income Tax, I am an Indian business/customer

Help me learn Income Tax, I am an Indian business/customer

The Finance Act, 2020 introduced a new provision under the Income Tax Act, 1961 — Section 194-O — which deals with Tax Deducted at Source (TDS) on e-commerce transactions. This section came into effect on 1st October 2020 and has significant implications for e-commerce operators and sellers.

Section 194-O mandates that e-commerce operators must deduct TDS at the rate of 0.1% on the gross amount of sales or services facilitated through their digital platforms.

Rate of TDS

  • 0.1% of the gross amount of sale or service facilitated.
  • If the seller has not provided a PAN, the TDS rate is 5%.

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