Consequences of TDS defaults

      50 Comments on Consequences of TDS defaults

Failure to deduct taxes or wrong deduction of TDS (non deposit, short deposit or late deposit):

Default/ Failure Section
Nature of Demand Quantum of demand or penalty

Failure to deduct tax at source

201(1) Tax demand Equal to tax amount deductible but not deducted
201(1A) Interest @1 % p.m. of tax deductible
271C Penalty Equal amount of tax deductible but not deducted
Failure to deposit tax at source 201(1) Tax demand Equal to tax amount not deposited
  201(1A) Interest @1.5% p.m. of tax not deducted
  276B Prosecution Rigorous imprisonment for a term for a minimum of 3 months which may extend to 7 years and with fine
Failure to apply for TAN No. u/s 203A 272BB Penalty Rs. 10000
Failure to furnish prescribed statements u/s 200(3) 272A(2)(k) Penalty Rs. 100 every day during which the failure continues subject to maximum of TDS amount
Failure to issue TDS certificate u/s 203 272(A)(g) Penalty Rs. 100 every day during which the failure continues subject to maximum of TDS amount.
Failure to furnish statement of perquisite or profit in lieu of salary u/s 192(2C) 272(A)(i) Penalty Rs. 100 every day during which the failure continues subject to maximum of TDS amount
Failure to mention PAN of the deductee in the TDS statements and certificates 272B Penalty

Rs. 10000

 If TDS return is not filed within the specified due dates being 15th July, 2013 for the 1st quarter corresponding to FY 2013-14, the major consequences would be levy interest.

However in case of payments made under sec. 194A, 194C, 194H, 194I and 194J in respect of individual and HUF, only if the turnover or professional receipt exceeds sum of Rs. 1 Crore or Rs. 25 Lacs respectively in previous year, there is a requirement to deduct tax at source.

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50 comments on “Consequences of TDS defaults

  1. Shyam

    If I forget to disclose one of the income of which TDS was already deducted and deposited. No additional tax liability.
    What penalty will be charged in this scenario.

    Reply
  2. ANIL BANSAL ADVOCATE

    I WOULD LIKE TO KNOW THE POSITION IF THE RECEIPTS OF A CONTRACTOR EXCEEDS 1 CRORE IN A YEAR OR A SINGLE TRANSCTION IS MORE THAN ONE CRORE THE POSITION OF SURCHARGE ON DEDUCTOR

    Reply
  3. abdussalim

    How i can avoid the penalty for late filing tds return ( late fee).
    Return for 2012-13 q1 to q4 filed on Sep 2013. so we got notice from tds department Gaziyabad. Is there any solution ?

    Reply
  4. CN ADHIKARI

    I have received a demand of Rs. 9200/- from the IT department u/s 234E. My question is how to deposit the same (undet which challan and section, i am having both 194 C & 194 I) and how to file the correction statement.

    Reply
    1. Nirvaan jain

      You may pay the amount under either of the section 94C or 94I, it does not make any difference as this levy u/s 234E isn’t in respect of any particular payment rather its nor late filing of the TDS return. In case you would like to pay online, following are the steps

      STEP 1 – Visit – https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp

      STEP 2 – Choose Challan 281, Fill all details as requires (Noe since you have received a notice so code for type of payment will be 400). In nature of payment use either 94C or 94I.

      STEP 3 -Proceed and confirm name of organisation. In banks website put down the amount under 234E and pay.

      STEP 4 – Wait for the challan to get updated on Oltas. Download consolidated file from TRACES and file a correction after adding that challan details and respective CSI file.

      STEP 5 – Submit the fvu file generated with form 27A, original TDS receipt and other documents as required.

      STEP 3 –

      Reply
  5. SAJAN

    IF TAX WAS DEDUCTED FROM PAYMENT (COMMISSION ) ON 8/08/2013 BUT FAILED TO REMIT THE AMOUNT TILL 10/12/2013 WHAT WILL BE THE PENALTY, PLEASE REPLY

    Reply
  6. vinay

    We have a interest & late deduction notices from TDS-CPC. we already paid through challan-281. and then how to we fill the penalty challans in Quartly statements?????

    Reply
  7. Kushal Shrimal

    Which deductors are Required to Issue TDS certificate Till 30 May 2014.
    And whats the time period for individual decductor to Issue TDS Certificate..As For This Year i being Individual Decductor have not issued any Certificate..What are Consequences And penalty.

    Reply
  8. mahanthi lava kishan

    while making tds return for Q4 of FY-2013-14 i have wrongly updated as flag “c”.
    how to rectify this mistake

    Reply
  9. V.RAKESH

    DEAR SIR,

    I AM WORKING IN ONE INSTITUTE WIT SALARY 50,000. BUT I AM GETTING ONLY 45,000. THEY ARE SAYING THAT LEFT OF 5000 IS TDS. BUT THEY ARE NOT GIVING ANY CERTIFICATE, AND THEY ARE SAYING AT LAST YEAR ENDING YOU WILL GET THE WHAT EVER DEDUCTED MONEY. IS IT CORRECT SIR PLS HELP ME SIR

    Reply
  10. Balasaheb Shirke

    Very very thanks for providing lot of information
    Sir,
    i am running Trading/service proprietory business my turnover not exceeding Rs 1.00 crore but i am dedut tds u/s 194c and deposited tds with interest and filling tds return on 11/07/2014.Income tax dept sent notice of demand u/s 234E what i can do regarding this matter

    Reply
  11. RAVICHANDRAN

    I HAVE FILED THE TDS RETURNS IN LAST YEAR (2013-2014)AS NIL RETURN. IF I SUBSIQUENTLY FILLING THE REVISED TDS RETURN WHAT WOULD BE PENALTY I HAVE TO PAY.

    Reply
  12. RAMAN CHANDNA

    RESPCTED SIR,

    IN QTR2 RETURN WHEN WE CREATE 26Q WITH PAN NOT AVAILABLE. ASK FOR REFERENCE NO, WHEN WE ENTER REFERENCE NO IT SHOWS ERROR INVAILD DEDUCTEE REFERENCE NO. PLS ANY BODY KNOW WHAT REFERENCE NO WE ENTER IN THIS FIELD OR ITS SOFTWARE PROBLEM

    Reply
  13. vasu

    WE HAVE NOT FILLED THE TDS FOR Q2 AS WE DO NOT HAVE ANY TRANSECTION IN THAT PERIOD. IS WE STILL GET THE PENALTY FOR LATE FILLING / NOT FILLING ???

    Reply
  14. sanjay

    If i deduct TDS U/s 92J and in actual it should be deducted U/s 92C. What are the consequences ?
    Any panelty..??
    Kindly explain..if your answer is yes, then quote the respective section.

    Reply
  15. Appasamy Damodharan

    I supplied the goods to Govt.Department. They deducted TDS and not deposited to IT for the past 2 years. Question-1. TDS is applicable for only Goods Supply? Q-2. What are the consequences if not deposited? Q-3 What is my legal rights to recover the amount? Kindly clarify

    Reply
  16. Mohamed Gayaz

    Sir,

    This is a very useful information to all TDS deductors.

    Very good summarised information.

    Thanks for the same. Keep it up.

    Reply
  17. samit

    Sir couldn’t download my form 16 and 26 as how to download both form. Sir I start registration process in tdscpc so some error message your details are invalid but I m all space fill-up according to form 16 issued my service employr. If That form 16 wrong then how to get accurate 16

    Reply
  18. shubham khandelwal

    sir
    if i request for form 16A for assessment year 2016-17, 2nd Quarter, after 30/10/2015. then what would be the process. please me tell soon

    Reply
  19. SUHAS SHINDE

    We have received Notice from TDS department for paying interest and late filing fees for FY 2012-13. Please help me how to file correction statement and in Return and show interest and late fee payment.
    Please tell me which file to be download from TRACES to make correction to pay interst/late fees payment for FY 2012-13.

    Reply
  20. S K CHOPRA

    What is the remedy if a deductor after deduction of due tax does not issue Form 16A to the deductee .

    Reply
    1. TDSMAN Post author

      Dear asai,

      Our Support team is located at Kolkata. You can call us at our helpline number at (033) 22623535 / (033) 64596006 for your queries.

      Reply
  21. R K BHUWALKA

    As this post was written nearly three years ago and hence I would like to know whether the ‘Quantum of penalty or demand’ holds good even now or there is any change? Please change the date of this post to current date and also alter corrections, if any, in last two paragraphs.

    RK Bhuwalka

    Reply

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