TDS Return Filing

Every business, whether a startup or an existing company, is certain to incur some expenses or to make payments to its parties irrespective of its size and scale. Thus TDS provisions apply to all types and size of businesses. It applies in the same or similar way to a proprietor, firm, LLP or a company registered under the companies, Act. 2013. The payment of expense by a person is an Income in the hands of the recipient. Thus the payor is under a liability to deduct the tax at applicable rates while making payment to the party. For small payments, the provision of TDS does not apply until it crosses a threshold limit as prescribed. It must be noted that the TDS is applicable only on the specified payment and after it reaches the threshold limit. The most common types of expenses on which TDS is applicable is provided hereunder.

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    Eligibility criteria for filing TDS Return

    Organisations and employers who have a valid Tax Deduction and Collection Account Number (TAN) can file TDS returns. TDS must be filed for the below-mentioned payments that have been mentioned under the Income Tax Act:

    • Salary payment
    • Any gains that have been generated by winning puzzles, lotteries, and similar types of games.
    • Insurance commission
    • Any income that has been generated by Income on Securities.
    • Income that has been generated by winning horse races.
    • Payments that have been made towards National Savings Scheme and any other similar schemes.

    Procedure for validation of TDS Returns

    The procedure for the validation of the TDS Returns is mentioned below:

    • First, the relevant details must be mentioned in the file.
    • Once the details have been filled, it must be updated on the validation utility tool that is available on the portal.
    • The tool is available on the NSDL website and is available for free.
    • In case there are any errors in the file, the File Validation Utility (FVU) will report the error.
    • The required changes must be made on the file before sending it through the verification process again.

    Revised TDS Return

    In case there are any errors when filing the TDS returns such as incorrect PAN or challan details, the tax amount that was paid to the government will not come up on Form 16, Form 16A and Form 26AS. Under such circumstances, the TDS Returns must be filed again.

    What are the prerequisites for filing revised TDS Returns?

    The prerequisites for filing revised TDS Returns are mentioned below:

    • Filing of the revised TDS Return can only be done if the TIN central system accepts the original return.
    • The status of the return can be checked by providing the Provisional Receipt Number and the PAN details on the official website of the NSDL.
    • The preparation of the revised TDS Return must be done using the latest TDS statement. The consolidated statement can be downloaded from the TRACES website. However, the token or provisional receipt number of the original returns must be entered to download the latest statement.

    Features

    Easily Import Data

    Import data from Excel and TDS files

    TDS Computation

    Automatically Calculate TDS

    Verification

    Automatically verify TAN and PAN number

    FVU Submission

    Submit the return in FVU format without any difficulty

    OLTAS Linking

    Import data from Excel and TDS files

    Form Generation

    Generate Form 16, 16A and more with ease

    TDS Rate Chart for The FY-2019-2020 (AY: 2020-21)

    SectionNature of PaymentBasic Cut-off (Rs.) Per AnnumIndividual and HUFOther Than Individual/HUFPAN is not Submitted
    192Payment of Salaries by EmployersSlab rateSlab rateNot applicable30%
    192APremature payment by PF Organization from EPF A/c (i.e. before 5 Years).50,00010%Not applicable20%
    193Payment of Interest on Securities by company10,00010%10%20%
    194Payment of Dividend other than dividend as referred to Section 115O by company (i.e. Dividend on which Dividend Distribution Tax is not paid)2,50010%10%20%
    194APayment of Interest by bank40,000 (Non Sr.Citizen) 50,000 (Sr. Citizen)10%10%20%
    194APayment of Interest by others5,00010%10%20%
    194BPayment of prize from Wining from Lotteries by any person.10,00030%30%30%
    194BPayment of prize from Wining from Horse Race by any person.10,000.0030%30%30%
    194CPayment to Contractors by any person.30,000 (Single bill) or 1 Lakh aggregate bills during the year.1%2%20%
    194CPayment to Transporter Covered u/s. 44E and submit declaration in prescribed format. (i.e. owning less than 10 goods carriages)0020%
    194CPayment to Transporter not covered u/s. 44E (i.e. owning more than 10 goods carriages)30,000 (Single bill ) or 75,000.00 aggregate bills during the year.1%2%20%
    194DPayment of Insurance Commission to agents by Insurance Company.15,0005%10%20%
    194DAPayment in respect of maturity of Life Insurance Policy by Life Insurance Company.1 Lakh1%1%20%
    194DEPayment to NRI sportsman or association by any person or organization20%20%20%
    194EEPayment out of deposit under National Saving Scheme (NSS)2,50010%10%20%
    194FPayment with respect to repurchase of units by Mutual Fund Companies.20%20%20%
    194GPayment of Lottery Commission15,0005%5%20%
    194HPayment of commission or Brokerage15,0005%5%20%
    194IPayment of rent on land, building, furniture and fittings.240,00010%10%20%
    194IPayment of rent on plant, machinery or equipments.240,0002%2%20%
    194IBPayment made on account of transfer of immovable property other than agriculture land.50 Lakh1%1%20%
    194IARent payable by individual not covered u/s. 194I for land, building, furniture and fittings50,000 PM5%5%20%
    194JPayment of Professional Fees other than call centers30,00010%10%20%
    194JPayment of Professional Fees to call centers.30,0002%2%20%
    194LACompensation on transfer of certain immoveable property than Agriculture Land250,00010%10%20%
    SectionNature of PaymentTCS Rate (%)
    206CScrap1
    206CTendu Leaves5
    206CTimber obtained under a forest lease or other mode2.5
    206CAny other forest produce not being a timber or tendu leave2.5
    206CAlcoholic Liquor for human consumption1
    206CParking Lot, Toll Plaza, Mining and Quarrying2
    206CMinerals, being coal or lignite or iron ore (applicable from July 1, 2012)1
    206C

    Sale of motor vehicle of the value exceeding Rs. 10 Lacs (wef 01.06.2016)

    Motor vehicle clause not applicable on Central Government, a State Government, an embassy, a High Commission, Legation, Commission, Consulate and the Trade Representation of a foreign State; Local Authority; a Public Sector Company which is engaged in the business of carrying passengers (wef 01.04.2017)

    1

    Due Date of Payment of TDS & FIling of TDS Return

    SL. NO.PARTICULARDUE DATETYPE OF EVENT
    1Payment of TDS deducted under various sections of the income tax actBefore 7th day of Next MonthMonthly
    21st Quarter TDS Return ( 1st April to 30th June)31st JulyQuarterly
    32nd Quarter TDS Return ( 1st July to 30th September)31st OctoberQuarterly
    43rd Quarter TDS Return ( 1th October to 31st December)31st JanuaryQuarterly
    54th Quarter TDS Return ( 1st January to 31st March)31st MayQuarterly

    Note TDS deducted in a month is required to be paid before 7th day of next month. While making TDS mention correct section in the challan number 281. For TDS payment use separate challan while making payment for specific type (section). Interest on Late Payment is- 1.5% per month or part thereof, The penalty on Late filing of TDS Return is Rs. 200 per day, however it is limited to the TDS amount.

    Frequently Asked Questions​

    TDS means Tax Deducted at Source. It is the amount deducted from payments of various kinds such as salary, contract payment, commission etc. This deducted amount can be adjusted against the tax due of the deductee.

    It is the duty of the person who is making payment to someone for specified goods or services to deduct TDS and file TDS return. The specified payment includes salary, interest, commission, brokerage, professional fees, royalty, contract payments, etc. The person who deducts TDS is called deductor and the person whose tax is being deducted is called deductee.
    TDS is not required to be deducted by Individuals and HUF except for those whose accounts are required to be audited u/s 44AB i.e. whose gross receipts in preceding financial year in case of business is more than 2 crore (AY 2017-2018) or 1 crore ( AY 2016-2017) and in case of profession 50 lakhs ( AY 2017-2018) or 25 lakhs (AY 2016-2017).

    TAN is an alphanumeric 10 digit number required by a person who is liable to deduct TDS and file TDS return. Thus such person must make an application within a month of deducting TDS for allotment of Tax Deduction and Collection Number (TAN) in Form 49B. This number allotted is mandatory to mention in all TDS Certificates issued, returns, challans etc. If a person fails to apply for TAN he may be penalised up to Rs. 10,000/-.

    Different types of TDS forms are as follows :-
    Form 24Q -TDS on Salaries
    Form 26Q – TDS on payments other than Salaries
    Form 27Q – TDS on payments made to Non-Residents
    Form 27EQ – TCS

    PAN of the deductor has to be given by Non-Government deductors. It is essential to quote PAN of all deductees.

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