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Smart & Easy TDS Software for Preparing TDS Returns

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

Flag raised for 15G/H despite Income exceeding the amount of exemption

CPC(TDS)  has observed from its records that Flag “B” (for 15G/H Forms) has been wrongly raised in the quarterly TDS Statements. CPC(TDS) has issued a letter to all deductors in this regard.

The letter produced is given as under:

Dear Deductor ( TAN XXXXXXXXXX ),

CPC(TDS) feels glad to provide you with the new feature of downloading Form 27D, the Tax Collection Certificate for Deductees forming part of TCS Statements, filed in the form of 27EQ.

Centralized Processing Cell (TDS) has observed from its records that Flag “B” (for 15G/H Forms) has been wrongly raised in the quarterly TDS Statements as per the provisions of section 197A(1B) of the Income Tax Act, 1961. Following are the provisions of section 197A(1B) for your ready reference:

“The provisions of this section shall not apply where the amount of any income of the nature referred to in sub-section (1) or sub-section (1A), as the case may be, or the aggregate of the amounts of such incomes credited or paid or likely to be credited or paid during the previous year in which such income is to be included exceeds the maximum amount which is not chargeable to income-tax“.

What is Form 15G/ H and its relevance:

  • Under section 197A of the Income Tax Act 1961, Form 15G / H is a self-declaration, which is provided by a person resident in India (not being a Company or Firm) to their deductor that the tax on his estimated total income of the previous year, in which such income is to be included in computing his total income, will be NIL.
  • The Declaration is made in the following Forms:
    • Form 15H – For Senior Citizens
    • Form 15G – For other than Senior Citizens

Consequences, if deductor wrongly raises Flag “B” for Forms 15G/H:

If the deductor raises Flag “B” for non-deduction of tax, despite the total payments made by him exceeding the taxable amount, this results into incorrect reporting in the TDS Statements.

Your attention is invited to provisions of section 201 of the Act, which reads as follows:

Where any person who is required to deduct any sum, does not deduct or does not Pay or after deduction, fails to pay,

the whole or any part of the tax, then such person shall be deemed to be an assessee in default in respect of such tax.

Under section 277 of the Act, if a person makes a statement in any verification under this Act or under any rule made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true is punishable.

This may be noted that obligation to report each transaction correctly in the TDS statements, falls on the deductor and non-compliance amounts to incorrect verification of correctness of TDS statement.

You can reach out to us on ContactUs@tdscpc.gov.in or call our toll-free number 1800 103 0344.

CPC (TDS) is committed to provide best possible services to you.

CPC (TDS) TEAM

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No need to submit Provisional Receipt of original statement & Statement Statistics Report for furnishing e-TDS/TCS correction statement

With effect from June 1, 2014, Deductors/Collectors need not submit copy of Provisional Receipt of original statement and Statement Statistics Report (SSR) for furnishing e-TDS/TCS correction statement.

Income Tax Department has revised the procedure for acceptance of e-TDS/TCS correction statements. The same is intimated vide Circular No: NSDL/TIN/2014/024 dated 28 May, 2014. The revised procedure is applicable with effect from June 1, 2014

In view of the above circular, TIN-FCs are required to accept e-TDS/TCS correction statements from Deductors/Collectors with .FVU file and duly signed Form 27A (generated from the latest File Validation Utility). The copy of Original Provisional Receipt and Statement Statistic Report (SSR) need not be accepted from Deductor/Collector.

The Circular produced is given as under:

Circular No: NSDL/TIN/2014/024                                                                                                May 28, 2014

Subject: Revised procedure for acceptance of e-TDS/TCS correction statements and upload of scanned documents to TIN Central System

Attention of all TIN Facilitation Centers (TIN-PCs) is invited to the procedure of acceptance of e-TDS/TCS correction statements and upload of scanned images as provided in chapter 6 and 7 of the TIN-PC Operating Manual (TOM).

As per approval from Income Tax Department, the procedure for acceptance of e-TDS/TCS correction statement stands revised. The same is intimated vide this circular. The revised procedure applicable with effect From June 1, 2014 is as per table below:

Sr. No. Documents to be accepted along with e- TDS/TCS correction statements – Existing procedure Documents to be accepted along with e­TDS/TCS correction statements – Revised procedure (From June 1, 2014)
1 Physical Form 27A Physical Form 27A
2 Statement Statistics Report (SSR)  
3 Copy of Provisional Receipt of Original Statement  

In view of the above, TIN-PCs are required to accept e-TDS/TCS correction statements from Deductors/Collectors with .FVU file and duly signed Form 27A (generated from the latest File Validation Utility). The copy of Original Provisional Receipt and Statement Statistic Report need not be accepted from Deductor/Collector.

The verification of control total screen has to be carried out on the basis of information present on Form 27A.

Further, the revised procedure for upload of scanned images of e-TDS/TCS correction Statements, is as per the following table wherein e-TDS/TCS statements are accepted on or after June 1, 2014.

Documents accepted at the time ofacceptanceof e-TDS / TCS Statement Documents to be returned to Deductor / Collector Scanning of documents
1. CD/Pen Drive2. Form 27A 1. CD/ Pen Drive 1. Form 27A2. Provisional receipt copy generated from SAMIn case of multi-hatch correction statements, following documents to be scanned;

  • Batch 1
    • Form 27A
    • Provisional receipt copy generated from SAM
  • Batch 2
    • Provisional receipt copy generated from SAM
  • Batch 3
    • Provisional receipt copy generated From SAM

Note: For e-TDS/TCS statements accepted upto May 31, 2014, the scanned images of Form 27A and Provisional Receipt needs to be scanned and uploaded as referred vide circular number NSDL/T1N/2011/009 dated May 6, 2011.

The version of TOM after the above said updates is 5.10. The version control sheet is attached as Anneyure A

In case of any clarifications, contact TIN Support Desk on 022-24994201.

For and on behalf of

NSDL e-Governance Infrastructure Limited

Bushan Maideo

Senior Vice President

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Deductees reported in TDS Statements with structurally Valid, but actually Invalid PANs

CPC(TDS) has observed from its records that many deductors have reported deductees with invalid PANs in the quarterly TDS statements. These PANs appear structurally valid but they are invalid.

CPC(TDS) has issued a letter to all deductors in this regard. The letter produced is as follows:

Dear Deductor ( TAN XXXXXXXXXX ),

Centralized Processing Cell (TDS) has observed from its records that you have reported deductees with invalid PANs in your quarterly TDS statements. These PANs appear structurally valid, however, they are actually invalid, as they are not available in the PAN Master records.

For example, ARUPS4625S appears to be a valid PAN according to the alphabets and numerals in its structure, however, this is an invalid PAN, as this is not available in PAN Master.

What is the impact:

  • The impact of such errors is significant in nature, in view of following:
    • As per section 206AA, the tax is to be deducted at a higher rate, in case of reporting of invalid PANs. Therefore, Short Deduction is charged even if the tax has been deducted at the Section Rate, due to the applicability of section 206AA.
    • The deductor will not be able to generate TDS Certificates for their deductees with invalid PANs.
    • The taxpayer will not be able to avail correct TDS Credits

What actions to be taken:

  • The impact of such errors is significant in nature, in view of following:
    • PAN Verification facility on TRACES can be used for verifying the deductees. You are requested to Login to TRACES and navigate to “Dashboard” to locate “PAN Verification” in the Quick Links menu.
    • You can also use “Consolidated TAN – PAN File” that includes all the valid PANs attached with the respective TANs. To avail the facility, Login to TRACES and navigate to “Dashboard” to locate “Consolidated TAN – PAN File”.
    • To correct an invalid PAN reported earlier, a C5 Correction Statement is required to be filed.
    • The PANs can also be corrected using our Online Correction facility with Digital Signatures. To avail the facility, you are requested to Login to TRACES and navigate to “Defaults” tab to locate “Request for Correction” from the drop-down menu. For any assistance, please refer to the e-tutorial available on TRACES.

You can reach out to us on ContactUs@tdscpc.gov.in or call our toll-free number 1800 103 0344.

CPC (TDS) is committed to provide best possible services to you.

CPC (TDS) TEAM

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Downloading of Form16/ Form 16A from TRACES

Due date to download Form 16 for FY: 2013-14 is 31st May, 2014.

Due date to download Form 16A for Q4 FY: 2013-14 is 30th May, 2014.

Delay in requesting certificates may involve a fine of Rs. 100 per day u/s 272(A)(g) subject to an upper limit of the tax deducted. Click here for more details

Sl. No. Form Periodicity Due Date
1 16 Annual By 31st day of May of the financial year immediately following the financial year in which the income was paid and tax deducted
2 16A Quarterly Within fifteen days from the due date for furnishing the statement of tax deducted at source under rule 31A
  • To download the Form 16/Form 16A, registration is required at TRACES website
  • To view the tutorial on how to download Form 16 from TRACES, click here
  • To view the tutorial on how to download Form 16A from TRACES, click here
  • Password for form 16/16A file is your TAN number

After downloading the zip file from TRACES website, you have to convert the zip file into PDF Form 16/form 16A files. For this, you need PDF Generation Utility, which can be downloaded from TRACES website.

 

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