Finance Desk – From April 22, 2025, if you buy luxury items worth more than ₹10 lakh, you’ll need to pay an extra 1% as Tax Collected at Source (TCS). This rule was announced in Budget 2025 and is now officially in effect.
What Items Will This Tax Apply To?
If the item costs more than ₹10 lakh, 1% TCS will be added on things like:
Luxury watches
Expensive art, antiques, and collectibles
High-end bags, sunglasses, shoes
Luxury vehicles like yachts, boats, and helicopters
Premium sports gear (golf kits, ski-wear)
Home theatre systems
Racing or polo horses
Basically, if it’s luxury and costs a lot—it now comes with a 1% tax.
What Is TCS?
TCS (Tax Collected at Source) means the seller collects 1% extra from you at the time of purchase and deposits it to the government.
Example:
If you buy a bag for ₹15 lakh, the seller will collect ₹15,000 (1% of ₹15 lakh) as tax and pay it to the Income Tax Department.
Can You Get This Money Back?
Yes!
When you file your Income Tax Return (ITR), you can claim this amount. If your total tax is less, this will be adjusted or refunded—just like how TDS works on salary.
Why This Rule?
The government wants to:
Keep track of big luxury purchases
Stop tax evasion
Make sure everything is on record
So next time you shop for something super fancy—just remember: 1% extra for the taxman.
