TDS is the short form for Tax Deducted at Source. Any Company or any person making payment is required to deduct tax at source if the amount surpasses the prescribed threshold limit. The Income-tax Department of India decides the rate at which the TDS will be deducted. The entity or individual who deducts the supposed amount is known as deductor, and the person whose tax is deducted is known as Deductee. It is the responsibility of the deductor to deduct the TDS before making any payment and deposit it to the government. The procedure of filing the returns of the Tax Deducted at Source or TDS Return is known as TDS Return filing in India.
What is Tax Deducted at Source?
TDS is the acronym for Tax Deducted at Source, which means of collection of Income Tax in India. Tax Deducted at Source is done under the Income Tax Act, 1961. Under the provision of TDS, any payment enclosed is paid after withholding the amount as per the set percentage. It is managed by the Department of Revenue organized by the Indian Revenue Service, which is the part of the Central Board of Direct Taxes or CBDT. TDS is significant while conducting audits.
What are the groups under which the TDS return is filed?
The categories under which TDS Return is lodged are as follows:-
Salary of any individual;
Insurance Commission;
Income from any other sources such as lottery puzzles;
Payment from the National saving Scheme by the government;
The assessee needs to file the penalty for delay within the due date.
What are the benefits of the TDS Return filing?
According to the Income Tax Act 1961, filing TDS Return is mandatory for an individual or any business entity.
TDS Return filing on time helps the government in tracking the records of the inflow of Income.
The Return from the TDS Return filing is used for the welfare of the Nation.
Since the Tax is paid every quarter, so there is no load of paying the lump-sum tax.
What are the documents compulsory for TDS Return filing?
Following are the necessary documents to be submitted while filing the TDS return online:
What are the various categories of TDS Return Filing Forms?
The various categories of TDS return filing forms prescribed under TDS are as follows-
A contracted Form-27A should be attached with the return statement for the quarterly TDS.
What is the process for TDS Return filing?
The TDS Return filing comprises the details of total TDS deducted and the amount collected by Deductor, TAN/PAN of the Deductor and Deductee, challan information etc.
The process involved is as follows-
You are required to fill all columns of For-27A, that contains a control plan. Then the form is verified in hard copy with the TDS return filed electronically.
Also, you need to fill in the details of the total amount paid cautiously and the Tax deducted at source in all the forms, with Form No-24, Form No-26, Form No-27, and Form No-27A.
The assessee is required to mention the Tax Deduction Account Number (TAN) in Form No-27A. Likewise, this is similar to what is done in the case of e-TDS Return filing. It is dictated under section 203A(2) of the Income Tax Act in India.
Similarly, at the time of filing the TDS return, make sure that the details relating to the depositing of Tax deducted at source (TDS) have been mentioned precisely.
Besides, the basic form that has been used for e-TDS Return recommended by the department is obligatory to track. This is because it brings reliability and a better understanding of filling of the forms. Moreover, it is compulsory to mention the Bank Branch Code, which is a 7-digit code given to banks by the Reserve Bank of India (RBI).
Additionally, E-TDS return has to be filed in the ASCII clean text format. To avail of this format, you can use the software of your choices such as MS Excel, Computex, or Tally. Additionally, you have the option of using the software available at the NSDL website identified as (e-TDS RPU Light) Return Prepare Utility for filing the online Return. Moreover, it is obligatory to make sure that the online TDS file formats come with ‘txt’ as the filename extension lead.
Similarly, the physical returns are surrendered at any TIN-FC’s managed by NSDL. Furthermore, TIN-FC’s are found in particular areas across the country.
If online returns are filed, then they can be surrendered directly at the NSDL TIN website. In such cases, the deductor is required to sign the Return through digital signature.
Lastly, while sending the Return, if all the details mentioned are accurate, then a provisional receipt or token number will be issued. This temporary receipt or token number is considered as an acknowledgement, maintaining the fact that the Return has been marched. Though, in case the Return is not acknowledged, then a non-acceptance memo will be issued along with the reasons for refusals.
What is the penalty in the late filing of TDS Return?
Any individual or any entity who fails to file the TDS Return within the due dates as agreed will have to pay the late filing fee. The penalty fee will be as follows-
As Per Section 234E
A sum of INR 200 for every day for which such TDS return filing failure continues. The late fees should not be more than the sum of the TDS Return filing. The late TDS return filing fine is required to be submitted before TDS Return filing.
As Per Section 271H
The assessing officer has the control to direct the nonpayer to pay the price, which can be a minimum of INR 10,000 up to the maximum of INR 1 lakh. The penalty is in addition to late TDS return filing fees.
Apart from the delay in TDS return filing, a penalty is also involved in the event of the incorrect filing of the TDS Return.
What is the Due Date For Filing The TDS Return?
Though the TDS Return can be filed online, there is a due date for each quarterly submission. For the fiscal year 2019-20,
Conclusion
Any Company or any person making payment is required to deduct tax at source if the amount surpasses the prescribed threshold limit. The Income-tax Department of India decides the rate at which the TDS will be deducted. The entity or individual who deducts the supposed amount is known as deductor, and the person whose tax is deducted is known as Deductee. The deductor should deduct the TDS before making any payment and deposit to the government. If you want to know more about TDS Return Filing, contact Corpbiz.
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