In this article we would analyse whether tax needs to be deducted on payments made to foreign companies. In this world of globalization, where cross-border transactions are the order of the day, there is often confusion and ambiguity with regards to deduction or withholding of tax on payment made to foreign companies. Take, for example, a company situated in Bangalore, engaged in rendering IT and ITES services to their clients worldwide, which needs to pay marketing and business development fees to a company situated in Denmark. Now, the question is whether the Indian company should deduct or withhold taxes on payment made to the Denmark company. This article was written on YourStory.in by Taxmantra.com – Click here to read the full article.