TDSMAN Blog

smart & easy software for eTDS & eTCS returns

TDSMAN Blog - smart & easy software for eTDS & eTCS returns

Healthy Practices for Error-Free TDS Returns

Healthy practices for error – free TDS returns has been given below:

  1. Deduction/ Collection of Tax at Correct Rates.
  2. Timely Deposit of Tax Deducted at Source.
  3. Accurate Reporting of data related to tax deductions/ collections made.
  4. Submission of TDS Statements within the due dates.
  5. Verification and Issuance of TDS Certificates within time.
  6. CPC (TDS) is now sending “Intermediate Default Communication” for PAN Errors and Short Payments, which can be corrected during the interim period of a week of filing TDS Statements, before CPC (TDS) proceeds with computing Defaults for the relevant statement.
  7. User-friendly Online Correction facility can be used for Correction of Deductees, Tagging Unmatched Challans and Payment of Fees/ Interest. (Please 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).
  8. Aggregated TDS Compliance Report assists the PAN of the Deductor to administer TDS Defaults for associated TANs and to take appropriate action.
  9. The Deductor’s Dashboard provides you all necessary information to assist you in “Compliance Self-Assessment” and to take appropriate action.
  10. Non-filing Self-declaration can be made by navigating to Statements / Payments menu and submit details under Declaration for Non-Filing of Statements.
  11. PAN Verification and Consolidated TAN – PAN File facility on TRACES can be used for verifying the deductees.
  12. The Conso Files and Justification Reports downloaded from TRACES help you to identify errors in submission of revised Quarterly TDS Statements.
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Circular on claiming Tax Credit against non-deposit of TDS

A circular has been issued by CBDT regarding non-deposit of Tax Deducted at Source.  CBDT has mentioned in the circular that as per Section 199 of the Act credit of Tax Deducted at Source is given to the person only if it is paid to the Central Government Account. However, as per Section 205 of the Act the assessee shall not be called upon to pay the tax to the extent tax has been deducted from his income where the tax is deductible at source under the provisions of Chapter- XVII. 

The issued circular has been given below: 

No. 275/29/2014-IT-(B)
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes 

Dated New Delhi, the 1st June, 2015 

 

To,

The CCsIT (CCA)

Subject: Non-deposit of Tax Deducted at Source – regarding.

Sir/Madam,

1. Grievances have been received by the Board from many taxpayers that in their cases the deductor has deducted tax at source from payments made to them in accordance with the provisions of Chapter-XVII of the Income-tax Act, 1961 (hereafter ‘the Act’) but has failed to deposit the same into the Government account leading to denial of credit of such deduction of tax to these taxpayers and consequent raising of demand.

2. As per Section 199 of the Act credit of Tax Deducted at Source is given to the person only if it is paid to the Central Government Account. However, as per Section 205 of the Act the assessee shall not be called upon to pay the tax to the extent tax has been deducted from his income where the tax is deductible at source under the provisions of Chapter- XVII. Thus the Act puts a bar on direct demand against the assessee in such cases and the demand on account of tax credit mismatch cannot be enforced coercively.

3. This may be brought to the notice of all the assessing officers in your region so that if the facts of the case so justify, the assessees are not put at any inconvenience on account of default of deposit of tax into the Government account by the deductor.

4. This issues with the approval of Chairperson, CBDT.

 

Yours faithfully

(Sandeep Singh)
Under Secretary to the Govt. of India

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Important Guidelines for payment towards liability on account of Tax Deducted / Collected at Source

Given below are some relevant guidelines related to payment of TDS/ TCS liability:

A. Central Government Account (Receipts and Payments) Rules, 1983:

Date of Receipt for Cheques or Drafts: The Central Government Account (Receipts and Payments) Rules, 1983 contain, inter alia, regulate public moneys received by or on behalf of the Government of India. As per clause 20 of Part I (Preliminary and General Principles), the Date of receipt of Government revenues, dues etc. is determined as follows:

20. Date of receipt of Government revenues, dues etc.-

Government dues tendered in the form of a cheque or draft which is accepted under the provisions of rule 19 and is honoured on presentation, shall be deemed to have been paid-

i. where the cheque or draft is tendered to the bank, on the date on which it was cleared and entered in the receipt scroll;

B. Rule 125 of Income Tax Rules, 1962:

Electronic Payment of Tax: Rule 125 of Income Tax Rules, 1962 relates to Electronic Payment of Tax. The relevant provisions are as under:

  • The following persons shall pay tax electronically on or after the 1st day of April, 2008:
    • a company; and
    • a person (other than a company), to whom the provisions of section 44AB are applicable.
  • For the purposes of this rule :
    • “pay tax electronically” shall mean, payment of tax by way of-
    • internet banking facility of the authority bank; or

In the light of the above, it is suggested that the payments towards TDS may kindly be made through e-payment mode. This helps in better reporting of challan by deductors and consequential matching of such challans.

It shall help the deductors in reduction of late payment interest that may arise due to delay in date of tendering of cheques and date of credit to the Government account.

Source: TRACES

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