Failure to deduct taxes or wrong deduction of TDS (non deposit, short deposit or late deposit) :
||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)||Interestfirstname.lastname@example.org% 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. 200 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||
For example, If TDS return is not filed within the specified due dates being 31st January, 2021 for the 3rd quarter corresponding to FY 2020-21, the major consequences would be levy interest.
However in case of payments made under sec. 194A, 194C, 194H, 194I and 194J (a & b) 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.