Section 195A of Income Tax Act for AY 2023-24

Section 195A of Income Tax Act 1961 amended by Finance Act 2022 and Income-tax Rules 1962. Provisions and rule for Income payable net of tax.

Amended and updated notes on section 195A of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to Income payable “net of tax”.

Chapter XVII (Sections 190 to 234G) of the Income Tax Act 1961 deals with the provisions related to collection and recovery of tax. Section 195A of IT Act 1961 provides for Income payable “net of tax”.

Recently, we have discussed in detail section 195 (Other sums) of IT Act 1961. Today, we learn the provisions of section 195A of Income-tax Act 1961. The amended provision of section 195A is effective for financial year 2022-23 relevant to the assessment year 2023-24.

In this article, you will learn detail of the provisions of section 195A of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962 as provided by Ministry of Law and Justice, Government of India.

Section-195A: Income payable net of tax

In a case other than that referred to in sub-section (1A) of section 192, where under an agreement or other arrangement, the tax chargeable on any income referred to in the foregoing provisions of this Chapter is to be borne by the person by whom the income is payable, then, for the purposes of deduction of tax under those provisions such income shall be increased to such amount as would, after deduction of tax thereon at the rates in force for the financial year in which such income is payable, be equal to the net amount payable under such agreement or arrangement.


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