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Smart & Easy TDS Software for Preparing TDS Returns

TDSMAN Blog - Smart & Easy TDS Software for Preparing TDS Returns

Things to be done on receipt of demand notice u/s 234E Late Filing

What should One do on receipt of demand notice u/s 234E Late Filing?

The default amount will have to be deposited through challan no. 281. Download conso file from TRACES for filing correction and tag the paid challan without adding any deductee records. While filing correction, fill up the fee amount in ‘Fee’ column in challan detail.

Note: There is no need to send any communication to TDSCPC separately.

Late filing correction in RPUFor example: Due date of filling of TDS statement form 26Q for Quarter 4 is 15th May , however statement 26Q has been filed with the delay of two(02) days. So deductor is required to quote late filing fee of Rs. 400.00( Rs. 200.00*2) as given below:

The “column” number for quoting of “fee” form wise is as under:

Form Type

Fee Column

24Q 305
26Q 404
27Q 706
27EQ 656
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How will transactions of more than one buyer/seller be filed in Form 26QB – TDS on immovable property?

1)How many Form no: 26 QB should be filled online if Immovable Property is purchased by two buyers from two sellers i.e. one sale deed / agreement is in the name of two buyers from two sellers,

2) Should TDS be paid 25 % wise e.g., if property of Rs 60 lakhs is purchased then should TDS be 25%wise i.e. four Form no 26 QB should be filled & TDS be paid 25%wise?

Ans: Earlier there was confusion on this issue. However, this issue has now been clarified by Income Tax Department. In case of multiple sellers, Form 26QB needs to be filed for each seller separately. Similarly, in case of multiple buyers, each needs to issue Form 26QB separately.

Relevant FAQ on NSDL site is reproduced as under:

How will transactions of joint parties (more than one buyer/seller) be filed in Form 26QB?

Online statement cum Challan Form/ Form 26QB is to be filled in by each buyer for unique buyer-seller combination for respective share. E.g. in case of one buyer and two sellers, two forms have to be filled in and for two buyers and two seller, four forms have to be filled in for respective property shares.

 

 

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Procedure for filing eTDS/TCS Returns with Insufficient Deductee PAN

Finance Act, 2003 amended section 206 of Income Tax Act, 1961 to make it mandatory for corporate deductors to furnish their TDS returns in electronic form (eTDS returns). The scheme for furnishing TDS return in electronic form was notified by the Central Board of Direct Taxes (CBDT) vide Notification No. 205/2003 dated August 26, 2003.

Finance Act, 2004, further amended section 206 of the Income Tax Act, 1961, making it mandatory for government deductors also to furnish e-TDS returns from F.Y. 2004-05. E-TDS returns are to be prepared in accordance with the data structure (file format) specified by Income Tax Department (ITD).

Income Tax Department vide its notification no. 238/2007 dated August, 2007 amended Rules 31A of the Income Tax Rules, 1962 to provide mandatory electronic filing of TDS return in respect of following cases :

1. Deductors required to get accounts audited u.s. 44AB in the immediately preceding financial year.
2. Deductors having number of deductee records in a quarterly return for any quarter of the immediately preceding financial year more than or equal to 50.

How do I file my quarterly e-TDS/TCS return, if I don’t have PANs of all deductees?

Ans.: You can file your eTDS/TCS return for the deductees who have valid PANs and subsequently file correction return for remaining deductees whose PANs were not available with you while furnishing regular return.

How do I include deductees whose details were not provided earlier due to unavailability of PAN?

Ans.: You are required to file a correction return in a prescribed file format available at www.tin-nsdl.com

What amount should be mentioned in the challan details in case a regular return is filed only for those deductees whose PAN is present and subsequently a correction is filed with the remaining deductees?

The amount deposited vide that particular challan should be mentioned in the original as well as correction return.

Example:

  • Suppose a challan payment of Rs.1,00,000/- has been made for non-salary TDS against 100 deductees each with TDS of Rs.1,000/-. Under the existing procedure the deductor will have to quote at least 85 PAN failing which his return will be rejected.
  • If there are only 50 deductees whose PAN is available and the deductor attempts to file a return with details of 100 deductees with PAN of only 50 deductees, the return will automatically be rejected at present.
  • However, if he files a return with challan amount of Rs. 1,00,000/- and with details of 50 deductees with PAN, with deductee total of Rs.50,000/-, the return will be accepted. It means the deductor can furnish the details relating to such deductees whose PANs are available.
  • The deductor can later file correction returns with other details of remaining deductees with the same challan details, i.e., the challan amount should be the amount deposited (in this case Rs. 1,00,000/-).
  • The return will be accepted so long as the TDS total of incremental deductees is less than or equal to the balance of Rs.50,000/-.

Permanent Account Number of Deductee

In case valid PAN of a deductee is not available, the deductor should mention the details as under :

PANAPPLIED in case deductee does not have a PAN but has applied and provided proof of application of PAN.

PANNOTAVBL where deductee has not given any PAN or proof of PAN application. This means PAN is not available.

PANINVALID – where deductee has provided PAN but it is structurally invalid.

The Deductee PAN field should contain a structurally valid PAN or PANAPPLIED or PANNOTAVBL or PANINVALID only. If any other value is mentioned in this field then the FVU will give an error during validation of the TDS return.

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How to pay Advance Tax for Asstt. Year 2014-15?

PAYMENT OF ADVANCE
U/S. 207, 208, 209, 210 AND 211 OF THE INCOME TAX ACT, 1961

Payment of advance tax is governed by sec. 207,208,209,210 and 211 of the Income Tax Act 1961.

Payment of Advance Tax is also known as ‘pay tax as and when you earn’. As per the provision, tax payable on income of a previous year is to be fully paid with in the previous year itself. One can not defer the tax payment to the assessment year. The Advance tax liability arises only to those assesses whose tax liability for the previous year is Rs. 10,000/- or more.

Advance tax helps Govt. to receive constant tax receipt throughout the year. Advance tax is to be paid by all assesses before filing the Income Tax Return.

For individuals who have only salary income, advance tax payment would be taken care by the TDS made by the employer. The details of TDS will be specified in Form 16 issued to the employee.

Advance tax payment schedules:

DUE DATE AMOUNT OF TAX
15th September At least 30% of Tax on total income for the year.
14th December At least 60% of Tax on total income for the year less advance tax already paid.
15th March 100% of Tax on total income for the year less advance tax already paid.

Advance tax is to be paid on all incomes. Therefore, it is payable on capital gain also. However, as the capital gain can not be estimated in advance, advance tax is paid on all capital gains when they arise in the immediately next advance tax due date.

Interest on late payment of Advance Tax:
Interest on late payment of Advance Tax is governed by sections 234 A, 234 B and 234 C.

Interest under section 234A – Default in furnishing the return of Income:
If an assessee has not filed the return of income within the due date, a simple interest @ 1% for every month or part of a month shall be payable. It is calculated from the due date to date of furnishing the return.

Example:
A company files its return on 15th December. Due date of filing return of income is 30th September. Let us assume that the tax payable by the company is Rs.1,00,000. Interest will be calculated as follows:

Tax Liability Rs. 1,00,000/-

Delay = 3 months ie October, November and December.

Interest payable = Rs.1,00,000 X 3%= Rs. 3,000/-

Interest under section 234B- Default in payment of Advance Tax:
If an assessee who is liable to pay advance tax , but not paid the same or or if the advance tax paid by him is less than 90% of the assessed tax, he is liable to pay simple interest at 1% every month or part of a month.

Interest is calculated from April 1st of the next financial year to the date of determination of total income under Section 143 (1). But, if regular assessment u/s. 143 (3) is completed, then interest is charged up to the date of regular assessment.

Interest shall be calculated on the amount equal to the assessed tax in case no advance tax is paid, or on the amount by which the advance tax paid falls short of the assessed tax.

Example:
Mr. X has a tax liability of Rs. 5,00,000/-. TDS Rs. 1,00,000/-
Advance tax payment made by Mr. X for the year is as below:-
15th Sept 2012 Rs. 25,000/-
15th Dec  2012 Rs. 50,000/-
15th Mar  2013 Rs. 25,000/-

Total advance tax paid Rs.1,00,000 /-

Interest u/s 234B is calculated as follows:
Tax on income Rs. 5,00,000
Less TDS         Rs. 1,00,000
                          ————
Assessed tax     Rs. 4,00,000

90% of assessed tax = 400000 X 90% = Rs. 3,60,000 /-

Advance tax paid by Mr. X – Rs.1,00,000 /-

Since there is a shortfall in payment of advance tax, Sec 234B is attracted.

Shortfall = Rs. 3,60,000– Rs. 1,00,000 = Rs.2,60,000/-
(Shortfall means difference between assessed tax and advance tax paid).

Interest under section 234 B = 260000*1%*4 months (Apr-July) = Rs.10,400 /- 

Interest under section 234C
If the advance tax paid is in underestimated instalments or if it s not paid at all, Section 234C gets attracted.

Interest is calculated on the difference between the instalment paid and instalment payable. Rate of interest is @ 1% p.m. for a period of 3 months for every deferment. But, for last instalment on 15th March, interest would be 1% for 1 month only.

Example:
Mr. X gives the following details:
Tax liability on total income Rs. 5,00,000/-
TDS = Rs. 1,00,000
Payment of advance tax:
15 Sept 2012           Rs.  50,000/-
14 Dec  2012           Rs.1,00,000/-
15 Mar  2013           Rs.1,50,000/-
Total advance tax paid Rs.3,00,000/-

Solution:-
Tax liability Rs. 5,00,000
Less TDS Rs. 50,000
Assessed tax Rs.450000 [ 5,00,000 minus 50,000]

Interest u/s 234C is computed as under:

Sept 15
30% of 4,50,000 = 135000 minus 50000 ie; Rs. 85,000 short paid
Interest = 85,000*1% X 3months = 2,550/-

Dec 14
60% of 4,50,000 = 2,70,000 minus 1,50,000/- = Rs. 1,20,000/- paid short.
Interest = 1,20,000*1% X 3months = 3,600/-

15 Mar
100% of 4,50,000 = 450000 minus 3,00,000 = Rs. 1,50,000 /- paid short
1,50,000 X 1% X 1month = Rs. 1500/-
Total Interest payable u/s. 234C is Rs. 2,550+ 3,600+ 1,500 = 7,650/- 

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