TCS would be applied on the purchase of an overseas tour program from an Indian tour operator, travel agent, or online service provider.
A tour package includes two or more of the following:
• Overseas traveling expenses
• Boarding/lodging
• Accommodation in hotel
• International travel
Personal travel booked directly: No applicability of TCS.
TCS is not an additional tax. It is a sort of tax credit that the person receiving income is entitled to at the time of filing his Income Tax Return.
TCS Rates
Up to ₹10 lakh → 5%
Above ₹10 lakh → 5% on first ₹10 lakh, 20% on the balance
If PAN is not provided, then the TCS rates are higher at 10% up to ₹10 lakh.
Examples
Example 1 : Hajj tour costing ₹15,00,000
TCS on the first ₹10,00,000 → 5% = ₹50,000
TCS on remaining ₹5,00,000 → 20% = ₹1,00,000
Total TCS collected = ₹ 1,50,00
Example 2: Tourist package costing ₹2,00,000
PAN provided: 5% = ₹ 10,000
No PAN 10% = ₹ 20,000
This tax is collected by the tour operator at the time of payment and deposited with the government.
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