What is TDS on payments to non-residents (Section 195) deep dive?

Section 195 requires anyone making a payment to a non-resident to deduct TDS. The key challenges are determining if the income is taxable in India and what the correct rate is, which depends on the nature of payment and the DTAA with the non-resident's country.

Startup Example: A startup pays a US-based marketing consultant. It must determine if this is a "fee for technical services" under the India-US DTAA, obtain the consultant's tax residency certificate, and deduct TDS at the applicable treaty rate before making the payment.

This is a core focus of our solution for foreign payments.