Compliance - TDS
TDS Returns and Payments
Tax Deducted at Source or TDS is a source of collecting tax by Government of India at the time when a transaction takes place. Here, the tax is required to be deducted at the time money is credited to the payee’s account or at the time of payment, whichever is earlier.
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In case of payment of salary or life insurance policy, tax is deducted at the time of payment. The deductor then deposits this TDS amount to the Income Tax (I-T) department. Through TDS, some portion of your tax is automatically paid to the I-T department. Thus, TDS is considered as a method of reducing tax evasion.
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Apart from depositing the tax, the deductor should also file a TDS return. TDS return is a quarterly statement to be given to the I-T department. It is compulsory for deductors to submit a TDS return on time.
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The details required to file TDS returns are:
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PAN of the deductor and the deductee
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Amount of tax paid to the government
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TDS challan information
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Others, if any
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Due Dates for Payment of TDS
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Due Dates for TDS Returns
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TDS Returns Forms
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Penalty for delay in filing TDS Return
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According to Section 234E, if an assessee fails to file his/her TDS Return before the due date, a penalty of Rs 200 per day shall be paid by the assessee until the time the default continues. However, the total penalty should not exceed the TDS amount.
Non-filing of TDS Return
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If an assessee has not filed the return within 1 year from the due date of filing return or if a person has furnished incorrect information, he/she shall also be liable for penalty. The penalty levied should not be less than Rs 10,000 and not more than Rs 1,00,000/-
TDS Refund
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TDS is the tax amount deducted at the time of payment. At the year end, while assessing the total tax liability, there is a difference between the total tax deducted during the year and the actual tax liability. If the tax deducted at the source is less than the actual tax liability, then the difference between the two has to be paid by the assessee. On the other hand, if the tax deducted at source is more than the actual tax liability, it results in TDS refund.