Lower TDS under section 194LC extended to any type of long term foreign currency bonds.

Lower TDS deduction at the rate of 5% under section 194LC extended to any type of long term bonds raised in foreign currency subject to compliance of conditions specified under circular 15/2014.

Section 194LC of the Income-tax Act, 1961, introduced by the Finance Act 2012,provided for lower withholding tax at the rate of 5% on the interest payments by Indian companies on borrowings made in foreign currency by such companies from a source outside India. The benefit was available in respect of borrowings made either under an agreement or by way of issue of long term infrastructure bonds. Continue reading