TDS Return Filing

TDS which is the abbreviation for Tax Deducted at Source is the advance tax paid by entity/ individual responsible for making payments of professional fee, contract payments, salary, interests, royalty, and dividends among others as per the appropriate tax slabs to Government on behalf of the payee.

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What is TDS Return Filing?


TDS is the abbreviation for Tax Deducted at Source is the advance tax paid by entity/individual responsible for making payments of professional fee, contract payments, salary, interests, royalty, and dividends among others as per the appropriate tax slabs to Government on behalf of the payee. It serves as a quick and efficient method for collection of applicable taxes.

The entity/ individual which deducts the said amount is termed as Deductor and the person whose tax is deducted is termed as Deductee. The net amount received by the recipient is after deducting the TDS amount.

A TDS Return filing is thus a statement of all the TDS transactions made during a quarter submitted by the Deductor to Income Tax Department. It shows a summary of the TDS amount collected paid by the Deductor to the Authority. It has the particulars like PAN number of both, the Deductor & the Deductee, the amount paid to the government etc as per the chalaan.

What are the duties of the person deducting tax at source?

The basic duties of the Deductor are as following:

  • The Deductor shall obtain Tax Deduction Account Number (TAN). In all documents and communication pertaining to TDS, the TAN has to be quoted.
  • The Deductor has to deduct the Tax at Source at the applicable rate and pay it to the Government within a specified time period.
  • The Deductor has to file the periodic TDS statements of the TDS return filing and issue the TDS certificate to the payee.

What are the repercussions if the Deductor defaults in his duties to deduct TDS or after deducting the TDS, in depositing it to the Government?


If a Deductor who is liable to deduct TDS and deposit the same to the Government fails on any of the fronts, shall have to face the consequences. A person who fails to do TDS return filing or does not TDS return filing by the due dates prescribed in this regard has to pay late filing fees as per section 234E and above that a penalty as per section 271H.

1. Late TDS Return filing fee as per section 234E


It is a sum of Rs. 200 for every day for which such TDS return filing failure continues. The late fees shall not exceed the amount of TDS Return filing. Before the TDS Return Filing, the late TDS return filing fee is required to be deposited.

2. For the penalty under section 271H


The assessing officer has the powers to direct the defaulter to pay a penalty which can be minimum of Rs. 10,000 up to the maximum of Rs.1 lakhs. This penalty is in addition to late TDS return filing fees mentioned above.

Apart from delay in TDS return filing, a penalty is also attracted in the event of the incorrect of TDS return file.

What is the procedure of TDS return filing?


TDS return filing is the quarterly submission of the statement to Income Tax Department and is required to be submitted by Deductor. The TDS returns filing filed shall contain the details of total TDS deducted and deposited by Deductor, TAN/ PAN of Deductor and Deductee, challan details etc.

Following are the various types of TDS return filing forms prescribed as per the purpose of TDS:

  • Form 24Q which is for the statement for tax deduction at source from salary,
  • Form 26Q which is for the statement for tax deduction source from all payments except for the salary, and
  • Form 27Q which is for the statement for the tax deduction from other sources of earning, example: dividend funds, interests from savings or fixed deposits, any sum payable to non-residents etc.
  • Form 27EQ which is the Statement of tax collected at the source,

A signed Form 27A shall be attached with the return statement for the quarterly TDS. It serves as a summary to the TDS deducted and deposited.

TDS return filing can be filed online by following the below mentioned steps:

  • A prescribed format in which e-TDS or e-TCS return has to be filed must be prepared;
  • TDS return filing have to be filed on the Income Tax Department website with valid login credentials.
  • The details like name, bank etc as required have to be entered.

Who has to issue TDS Return Filing certificates?

As per Section 203 of the Income Tax Act, the Deductor of TDS has to mandatorily provide the TDS Certificate with the required details. Form 16/16A are issued furnishing details of TDS transactions between deductor and deductee, PAN details etc

  1. Form 16 is for salary income, issued annually
  2. Form 16A is for all income other than salary, issued quarterly

Even the banks deducting tax at the time of payment of pensions must issue TDS Certificates.

Non-issuance of TDS after the deduction attracts a penalty of Rs. 100 per certificate per day.

TDS certificates are generated by the deductor from TRACES (TDS Reconciliation Analysis and Correction Enabling System), which can be digitally signed.

Thus a Deductor must issue a TDS Certificate to the payee.

What are the features of Tax Deduction and Collection Account Number (TAN)?

  • TAN is a unique 10 digit alpha-numeric number that must be obtained by those who deduct and/ or collect TDS. Under the Section 203A of the Income Tax Act, 1961, the TAN number allotted by ITD has to be quoted on all TDS returns.
  • The application of TAN number can be made online on the NDSL site or a physically by submitting TAN Application form.
  • Individuals who operate a sole proprietorship business are also required to obtain TAN and deduct tax at source when required as per the applicable laws.
  • Once a TAN is issued, it remains valid for lifetime.
  • If a person who is required to apply for and obtain TAN, does not do so, they shall be penalized with a fine of Rs.10,000.
  • Our consultants at corpbiz shall help you in applying for TAN.

How will the consultants at corpbiz assist you with TDS return filing?

Our experts shall aid you in the following manner:

  • Consultation
  • Collection of all the documents and information required for preparing the TDS return filing and its filing.
  • Return preparation and TDS return filing

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