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How to Claim TCS Refund on Car Purchase: Every year thousands of luxury and mid-segment cars are sold in India in which TCS is charged. But many people do not know the refund they get from this, and leave their money with the government.
New Delhi. In India, whenever someone buys a car worth more than ₹ 10 lakh, the car dealership adds 1% TCS (Tax Collected at Source) to the bill. The car buyer can get this money back. But, due to lack of information, most buyers consider it to be an additional charge and do not claim. This TCS is not an extra expense, but your own money, which you can get back by claiming it while filing ITR. —Now this issue suddenly came into discussion again after an ex-post by investor Ashish Kumar Mehar.
Mehar wrote on He further wrote, “Whenever you buy a car above ₹10 lakh, the dealer charges 1% TCS. That is, ₹10 lakh car → ₹10,000 TCS. ₹30 lakh SUV → ₹30,000 TCS. This money is yours. You can claim it.”
Understand the complete fund of TCS
Under Section 206C(1F) of the Income Tax Act, dealers are required to charge 1% TCS on cars worth more than ₹10 lakh. This tax works like an advance tax from the government. The thing to note here is that TCS is collected only on the amount more than Rs 10 lakh. That is, if you have bought a car worth Rs 12 lakh, then Rs 2,000 will be taken from you as one percent TCS on Rs 2 lakh only. If you have a car worth Rs 20 lakh then your TCS will be Rs 10 thousand.
How to get your money back
The dealer deposits this money directly into the government account and it gets linked with your PAN number. That means the government believes that you have already paid this tax and on that basis you can withdraw it. While filing ITR, many people do not even check that they have deposited TCS, whereas in reality this process is very easy. To get this TCS back, you must take Form 27D from the car dealer. This is a TCS certificate, in which it is written how much TCS has been deposited on your PAN.
