Tds Provisions India

Slide 1: TDS PROVISIONS KALYAN NATH ASST. COMMISSIONER OF INCOME TAX,TDS,KOL.

Slide 2: OBJECTIVES OF TDS Regular inflow of revenue for Government Checking of tax evasion Widening of tax base

Slide 3: IMPORTANT ISSUES - 1 Nature of payment Person responsible for paying Specified payee Deduction of tax Deposit of tax

Slide 4: IMPORTANT ISSUES - 2 TAN Issue of certificate Filing of return Filing of statements Declaration u/s 197A Lower deduction certificate u/s 197

Slide 5: NATURE OF PAYMENTS S.192 S.193 S.194 S.194A Salary Int.-Sec. Dividend Other Int. 194B 194BB 194C 194D Lot/CW Horse rac. Contract Ins. Com. 194E 194EE 194F 194G NR Sports NSS MF/UTI Com.Lot. 194H 194I 194J 194K,194LA Com/Brok Rent Prof/Tec. Units/C.Acq

Slide 6: PERSONS RESPONSIBLE FOR PAYING-1 ALL persons (Except individuals & HUF in certain cases)

Slide 7: PERSON RESPONSIBLE FOR PAYING-2 I AM A SMALL TIME BUSINESSMAN/PROFESSIONAL? W.E.F. 01.06.2002, Individuals and HUFs have to deduct tax at source if turnover exceeds Rs.40 lacs (business), Rs.10 lacs (profession) for payments u/s.194A, 194C, 194H, 194I & 194J.

Slide 8: SPECIFIED PAYEE All persons except – a) Quantum of payment is less than the prescribed limit b) General exemption u/s.10 or specific exemption in respective TDS provision c) Certificate issued by A.O. u/s.197 d) Declaration in form 15G and 15H

Slide 9: DEDUCTION OF TAX Tax is to be deducted at the time of credit or at the time of payment whichever is earlier, at the prescribed rate In the case of salary, TDS is on estimated income. In the case of payments other than salary, the TDS is on payments. Surcharge and Education Cess will be as applicable.

Slide 10: DEPOSIT OF TAX-1 In the case of salary – Within one week from the end of the month.

Slide 11: DEPOSIT OF TAX-2 In case of payments other than salary- Within ONE WEEK from the end of the month. Payments credited or paid on 31st March(last date of Accounting Year), within two months.

Slide 12: DEPOSIT OF TAX-3 Quarterly Payments in Special Cases 15 June, 15 Sept., 15 th th th Dec., 15th Mar. Prior approval of JCIT.

Slide 13: TAN The person responsible for deducting tax at source has to apply for TAN in Form No. 49B within one month from the end of the month in which tax is deducted for the first time. The TAN should be quoted in all challans, TDS Certificates, Quarterly Returns, statements and correspondence. Reformatted TAN.

Slide 14: ISSUE OF TDS CERTIFICATES- 1 (S 203 / R 31) The person responsible for deducting tax at source has to issue TDS certificates before the prescribed date- a) Normally, within one month from the end of the month in which the tax was deducted at source. b) If the non-salary payment is credited or paid on 31st March then the TDS will be deposited by 31st May – in such cases certificate should be issued by 7th of June. c) In case of consolidated certificate, within one month from the end of the Financial Year.

Slide 15: ISSUE OF TDS CERTIFICATES- 2 (S 203 / R 31) FORM NO. PARTICULARS 16 Salary 12BA Perquisites (Gross salary =>1,50,000) 16A Non-Salary 16AA Salary-cum-Return of income (Gross salary <=1,50,000)

Slide 16: ISSUE OF TDS CERTIFICATES - 2 Deductors will not issue TDS certificate in respect of tds made on or after 01.04.2008 A statement of TDS will be issued either by Income Tax Department or an Agency prescribed.(203AA & 206C(5)/ Rule 31AB)

Slide 17: FILING OF RETURN All TDS returns have to be filed before due dates prescribed. + In case of companies and Government deductors, e- TDS returns are compulsory.

Slide 18: FILING OF QUARTERLY STATEMENTS - 1 W.E.F. 01.04.2005, the person responsible for paying tax at source, shall after depositing the TDS, prepare and file Quarterly Statement with the TINFCs appointed by NSDL

Slide 19: FILING OF QUARTERLY STATEMENTS - 2 Form No. Particulars 24Q Salary 26Q Non-salary

Slide 20: FILING OF QUARTERLY STATEMENTS - 3 Q.E. Due Date When to file the 30th June 15th July Quarterly 30th Sept. 15th Oct. Statements 31st December 15th January 31st March 15th June

Slide 21: FILING OF QUARTERLY RETURN BY BANKS (206A/RULE 31 AC/FORM 26QA) Banks are required to file Quarterly Returns in respect of the payment of interest to the deposit holders without TDS

Slide 22: DECLARATION U/S.197A Form No. 15H By any person who attains the age of 65 during the F. Y. in respect of the following receipts +Interest on securities +Dividend +Interest other than interest on securities +Payment in respect of deposit under NSS +Income in respect of units Provided tax payable by such person is NIL.

Slide 23: LOWER DEDUCTION CERTIFICATE U/S 197 .Can be filed by any person. Application to be made in Form No.13 to the TDSAO. Certificate will be issued by the TDSAO

Slide 24: The person responsible for deducting tax at source will be held as assessee in default and the tax he ought to have deducted at source or he ought to have deposited will be collected from such person.

Slide 25: If the person responsible for deducting or depositing the tax at source, does not pay or deposit the TDS then Interest u/s.201(1A) @ 12% p.a. from the date on which the tax was deductible to the date on which such tax is actually paid will be levied on the amount of such tax.

Slide 26: CONSEQUENCES OF FAILURE TO DEDUCT OR DEPOSIT THE TAX AT SOURCE-3 The tax along with interest shall be a charge upon all the assets of the person / company, responsible for deducting tax at source.

Slide 27: CONSEQUENCES OF FAILURE TO DEDUCT OR DEPOSIT THE TAX AT SOURCE- 4 (S. 40(ia)) W.E.F. 01.04.2004 ( AY 2005-06), if the deductor does not deduct or deposit the tax at source, he shall not be allowed deduction while computing his own total income- interest, commission & brokerage, fee for professional & technical services and contract

Slide 29: PENALTY U/S 271C Penalty u/s.271C is leviable if the assessee fails to deduct the tax at source within the prescribed time. The penalty leviable is equal to the amount of tax the deductor failed to deduct.

Slide 30: FAILURE TO FURNISH THE TDS RETURN – 272A(2)© If the deductor fails to furnish the TDS return within due date, he shall be liable for penalty of Rs.100/- per day for the period of default.

Slide 31: FAILURE TO FURNISH A COPY OF CERTIFICATE - 272A(2)(g) If the deductor fails to furnish a certificate to the payee within the prescribed time, he shall be liable for penalty of Rs.100/- per day for the period of default.

Slide 32: FAILURE TO APPLY FOR TAN- 272BB If the deductor fails to apply for TAN within the prescribed time, he shall be liable for penalty of Rs.10000/-.

Slide 34: PROSECUTION U/S.276B If the deductor fails to deposit the tax deducted by him at source, he shall be punishable with rigorous imprisonment for a term from three months to seven years along with fine.

Slide 35: ON LINE TAX ACCOUNTING SYSTEM (OLTAS)-1 All India Data base of tax paid by the tax payers. It has a facility to check any payment made by the tax payer in the Government Account. Important resource in giving credit to the tax payers while processing IT/TDS return.

Slide 36: ON LINE TAX ACCOUNTING SYSTEM (OLTAS)-2 Important features- Only 2 challans Only 1 copy with detachable counterfoil For Advance tax and SA tax – Challan No.280 For TDS Challan No.281

Slide 37: ON LINE TAX ACCOUNTING SYSTEM (OLTAS)-3 5. The counterfoil has name of the branch – 7 digit BSR Code – date of deposit – Sl. No. of challan (5 digits) 6. No need to attach copy of challan with the tax return 7. Mention CIN – combination of 7 digit BSR Code – date of deposit – Sl. No. of challan (5 digits) 8. PAN/TAN must be mentioned correctly