What is Form 27C ?
Form 27C is a declaration form under the Income Tax Act, 1961 that allows a buyer or seller to claim exemption from Tax Deducted at Source (TDS) on certain specified goods and transactions. It is used primarily in cases where the buyer or seller is exempt from TDS as per the provisions of the Income Tax Act.
Key Features of Form 27C:
Exemption from TDS: This form is used to declare that the buyer or seller is eligible for a TDS exemption on specific goods mentioned in the Income Tax Act.
Usage: It applies to both buyers and sellers involved in transactions involving specified goods.
Goods Covered Under the Income Tax Act for Form 27C:
Form 27C can be used for the following goods, where TDS exemption may apply:
Alcohol or Liquor for Human Consumption: Alcohol or liquor sold for human consumption.
Tendu Leaves: Leaves used for making beedis.
Timber Procured Through Forest Lease: Timber obtained through leases granted by forest authorities.
Waste and Scrap: Waste materials or scrap from manufacturing processes.
Licensing or Leasing of Parking Lots or Toll Plazas: Income from leasing parking spaces or toll plazas.
Mining and Quarrying: Income generated from mining and quarrying operations.
Key Sections of Form 27C:
Buyer/Seller Details: Both parties must provide their details, including names, addresses, and PAN numbers.
Transaction Details: Information about the goods being bought or sold, including the quantity and value.
Purpose of Form 27C:
To allow buyers or sellers involved in the specified transactions to claim an exemption from TDS, ensuring they are not subjected to tax deduction at the time of payment or receipt.
How to Use Form 27C:
Filling and Signing: Both the buyer and seller must fill in the required details in the form and sign it.
Submission: The form must be submitted to the relevant authority, generally the seller or buyer who is responsible for deducting TDS in the transaction.
Form 27C helps businesses and individuals involved in specific transactions to avoid unnecessary tax deductions, thereby ensuring a smoother financial process.