How can foreign deductees without PAN avoid higher TDS?

NRI’s and foreign companies need to furnish PAN details or else they have to pay higher TDS rates. However, they can avoid higher TDS in absence of PAN card, by submitting the alternative documents listed below

They need to submit:

  • Name, email id and contact number
  • Address of the foreign deductee
  • Tax Residency Certificate (TRC) from the Government of that country if the law of that country provides for issuance of such certificate
  • Tax Identification Number (TIN) or any other Unique Identification Number (UIN) of the foreign deductee from the country where he is resident

However these rules are not applicable in the following cases and PAN is mandatory to avoid higher TDS  –

  • Fees for technical services
  • Interest
  • Royalty
  • Payments on transfer of any capital asset

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