TDS Filing

What is TDS?

Tax Deducted at Source (TDS) is a mechanism through which the Government of India collects taxes at the time of transaction occurrence. In this case, the tax is deducted either when the payee’s account is credited or at the time of payment, depending on which event occurs earlier.

The tax is deducted during the payment process for salary payments and life insurance policies. The entity responsible for making the payment must deposit the deducted tax amount with the Income Tax Department. TDS facilitates the direct payment of a portion of the tax to the Income Tax Department, typically at 10% or within a specified range.

File Your TDS Return Online

Online TDS return filing is a convenient and hassle-free way to fulfil your tax obligations. By filing your TDS return online, you can save time and effort. The TDS online process through Vakilsearch is simple and user-friendly, with step-by-step guidance available. Additionally, online filing ensures that your returns are accurate and error-free, minimising the risk of penalties and scrutiny from the tax authorities.

Overall, opting for online TDS return filing is a smart choice that can streamline your tax compliance process. The online portal uses the latest security measures to protect your data and prevent unauthorised access or fraud. Additionally, the system provides a record of your submission, which can be useful for future reference or if you need to demonstrate compliance with tax regulations. Overall, online TDS return filing is a smart and effective way to manage your tax obligations and stay compliant with the law.

TDS Return for Individuals and Businesses

An employer or company with a valid TAN – Tax Collection and Deduction Account Number can file for an online TDS return. Any individual or business that makes a particular payment stated under the I-T Act needs to deduct tax at source. The deposit for the same has to be made within the stipulated time. The payment categories include:

• Salary
• Insurance commission
• Income from winning horse races
• Income by way of ‘Income on Securities’
• Income by way of winning the lottery, puzzles, and others
• Payment in respect of National Saving Scheme and many others

An assessee can submit an e-TDS return if the same was deducted from their income. As mentioned earlier, it is the obligation of the assessee to file within the due date or be liable to pay the penalty for delay. The categories of assessees eligible to electronically file TDS return every quarter are:

• Company
• Persons whose accounts are audited u/s44AB
• Persons holding an office under the Government

Benefits of TDS Return Filing Online

As per the IT Act of 1961 filing TDS return is mandatory as well as it fetches some benefits to person or company. A few advantages of submitting a return and knowing the refund status are

• A steady inflow of income to the government.
• Facilitates a smooth collection of taxes used for welfare.
• No burden of paying tax lump sum as the payment is done every three months for the whole year

Now you can calculate TDS on salary online at Vakilsearch. With the help of the online TDS Interest Calculator, you can calculate your TDS while you sit at home.

What Is a TDS Certificate?

A TDS Certificate, also known as Form 16 or Form 16A, is a document issued by an employer or other deductor to an employee or payee that details the tax deducted at source (TDS) from their salary or income. It is issued at the end of the financial year and includes information such as the amount of income earned, the number of TDS deducted, and the amount of tax paid by the employee or payee. The employee or payee uses the TDS Certificate to claim credit for the tax paid while filing their income tax returns.

TDS Return Form

A TDS (Tax Deducted at Source) return form is a document used to report tax deductions made from an individual’s or organisation’s income. It is filed with the Income Tax Department of India and is used to ensure that the individual or organisation pays the correct amount of tax.

The TDS return form consists of details such as the taxpayer’s name and PAN (Permanent Account Number), the tax deductor’s name and TAN (Tax Deduction and Collection Account Number), the period of tax deduction, and the total amount of tax deducted. It also includes details of the tax deductible at sources, such as the nature of the payment, the amount paid, and the rate at which the tax was deducted.

TDS return forms can be filed electronically or through a physical form. It is important to file the TDS return form on time to avoid any penalties or fines.

Fine for Late Filing of TDS/TCS Returns

The fine for late filing of TDS/TCS returns in India is as follows:

• Under Section 234E of the Income Tax Act, 1961, a late filing fee of Rs. 200 per day is levied for every day of delay in filing the TDS/TCS return, up to a maximum of the amount of TDS/TCS deducted or collected.
• Under Section 271H of the Income Tax Act, 1961, the Assessing Officer may direct the person who fails to file the TDS/TCS return within the due date to pay a penalty of Rs. 10,000, which may be extended to Rs. 1,00,000.

The penalty for late filing of TDS/TCS returns is in addition to the late filing fee.

It is important to note that the penalty for late filing of TDS/TCS returns can be waived if the person can show that there was a reasonable cause for the delay.

TDS Payment Due Dates and Penalties

The table below lists the deadlines for depositing tax withheld at source and filing TDS returns for each deductor’s fiscal year 2023–2024. Check for the TDS rates as well every year.

Fine for Late Filing of TDS/TCS Returns

Late filing charges or collected as per Section 234e. Each and every person who files a TDS after the due date is subject to a fine of ₹200 everyday until the TDS return is filed. Say, for instance, that you deducted TDS of ₹5000 on 13 May 2023, and that you file your first quarter’s return on 17 November 2023, rather than the required 31 July 2023.

The delay is 109 days long, measured from 1 August 2023, to 17 November 2023.

The result of the calculation is ₹200 times 109 days, or ₹21,800. Since the total late fee amount is greater than the TDS amount of ₹5000 you will be required to pay ₹5000 as a late filing fee. You must also pay interest for any TDS deposit delays, which is described in the section below. WIth the help of Vakilsearch’s TDS deposit online, you can avoid TDS deposit delays.

Penalty (Sec 271H)

The officer has the right to order a penalty with the defaulters. The assessing officer can demand up to ₹10000 as penalty if the TDS is not submitted within the deadline. There is a penalty under this section in addition to the late filing charge under Section 234E.

• The government gets credited with the tax that was deducted or collected at the source
• All the late payment charges or paid directly to the government credit
• The TDS/TCS return is submitted before the end of the year following the deadline set forth in this regard.

Simplifying TDS Return Filing and Compliance

Every deductor must submit a TDS return to the Income Tax Department of India in quarterly statements. Every detail of the returns has to be accurate and precise. Keeping up with the quarterly payments can be cumbersome, and if not done on time, you may attract huge penalty.

The IT department sets the rate of TDS based on expenses recognised by them. Hence the prescribed rate of the deduction varies. Keeping the threshold limit in mind while making payments can be tedious.

Once you choose us, our affiliates prepare the account and file a TDS refund on your behalf. From the very first stage of preparing the returns till the last phase of the refund, we act as your consultants. Vakilsearch does all the paperwork for you and ensures that every government interaction is smooth. Our process is truly transparent and always meets your expectations. We take care of:

• Computing your TDS payments
• e-filing the TDS return
• Adherence to compliance with regulations

Things to Remember Before Filing TDS Return on Time

For any person who has a TDS reduction in their pay, TDS return can be filed online. Return preparation has to be done within the prescribed time frame because for individuals who are deemed as regular defaulters in India, a grave penalty can be charged. Therefore submitting an e-TDS Return in the prescribed time is essential.

For the deductor, it is vital to deposit the subtracted TDS to the concerned government department along with the details.

The period within which the deductor should deposit the amount, and the deductee has to file for TDS refund, are given below. It is essential to stick to the schedule to avoid incurring a penalty.

For online TDS returns, everyone who has made the TDS deduction should file the TDS return without fail. The deductor should make the quarterly submissions at the Income Tax department. Different types of forms are available in accordance with the change in the intent of the TDS deductions made. The PAN details of both the deductees and the deductor should be added in the statement. The statement should also contain information about the TDS challan and the tax details, among other important details.

In online TDS return, the statement/ TDS return is defined as the summary of every transaction made in relation to the quarterly TDS payments. This statement should be submitted by the deductor to the department of income tax for filing income tax returns.

For all deductors, the submission of TDS return is mandatory. It contains the details of TDS deductions and deposits made by the deductor. It should also contain PAN card details of both deductees and deductor, tax paid particulars, information about TDS challan and any other extra information the form demands.

TDS Return Filing Procedure

Step 1: Go to the website of the Income Tax Department (https://eportal.incometax.gov.in/iec/foservices/#/login) and log in to your account using your PAN and password

Step 2: Click on the ‘e-File’ tab on the top menu and select ‘Prepare and Submit TDS Return’

Step 3: Select the appropriate financial year and form (Form 26Q for TDS on salaries, Form 24Q for TDS on non-salaries, Form 27Q for TDS on foreign companies, etc.) and click ‘Continue’

Step 4: Enter all the required details, including the TDS amount, PAN of the deductee, and the tax deducted at source

Step 5: Verify the details and click on ‘Submit’

Step 6: You will receive an acknowledgement receipt of TDS return filing, which you can save or print for future reference

Step 7: If you have made any errors or omissions in the TDS return, you can file a revised return by following the same process. Just select the ‘Revised Return’ option instead of ‘Original Return’ while filing.

Filing a Revised TDS Return for Correcting Errors

In the case of online TDS return, if there are any errors committed due to incorrect challan details, incorrect PAN details or lack of PAN card details, the amount which is credited as the tax will not be reflected in the Form 16A/Form16/Form 26AS. In such cases a revised TDS return must be filed.

To file a revised TDS return, you need two files – a consolidated file containing the details of the deductions made in the quarter; and the one is the justification report containing the information on the errors filed in the return.

Understanding the Timeline for Filing TDS Refunds

While filing online TDS returns, if you pay in excess of the actual tax amount payable, you will be eligible to claim TDS refund. The time within which the refund is done depends on whether you have made the income tax return filing before or after the due date. If the returns were filed on time, you will receive the refund of the excess amount within 3-6 months.

In online TDS return, if there is a case of late filing or failure to file the returns, the individual or the company will have to face two types of penalties:

• The late filing fee- U/s 2 and 234E
• Non-filing penalty – U/s 271 H

Documents Required to File TDS Return Online

The following documents have to be submitted for filing the TDS returns.

• TAN details
• PAN details
• Last TDS filing details, if applicable
• The period for which TDS has to be filed
• Date of incorporation of the business
• No. of transactions for filing TDS returns
• Name of the entity – Proprietorship/ Partnership/ Company/ LLP

The due dates for e-filing of TDS & TCS returns for FY 2023-24 are as follows: