Indeed, it is a great privilege for Team TDSMAN and our mother organization PDS Infotech Pvt. Ltd. to be on the news. TDSMAN Software is a widely used TDS Returns preparing software, having its presence across India. We are grateful to our respected clients, eco system partners, vendors and other stakeholders, who helped us build our core strength by keeping trust on our products & services. We reaffirm our determination to keep on improving and serving our best.
Follow the links given below, to see the published news articles.
Section 194Q – TDS on Purchase of Goods limits the scope and applicability of the Section 206C(1H) – TCS on Sale of Goods as the Second Proviso to Section 206C(1H) states that if the buyer deducts tax as per any other provision on the goods purchased by him, no tax shall be collected on the same transaction.
Let us go through both the provisions for better understanding and distinction-
Tax to be deducted
Tax to be collected
Turnover/ Gross Receipt/ Sales from the business of BUYERshould exceed Rs 10 Cr during the year (excluding GST)
Purchase of goods of aggregate value exceeding Rs.50L in P.Y.
Turnover/ Gross Receipt/ Sales from the business of SELLERshould exceed Rs 10 Cr during the year (excluding GST)
Sale consideration received exceeds Rs.50L in P.Y.
Transactions on which TDS is applicable under other provisions of the act.
Transactions on which TCS is applicable under 206C other than 206C(1H).
Transaction on which TDS/TCS is applicable under other provisions of the act and the same has been complied with (Meaning thereby; in a situation where TDS has been deducted u/s 194Q this section will not apply)
Yet to be notified by Government
If buyer is –
Importer of goods
Center/State Govt., Local Authority
An embassy, High Commission, Consulate and trade representation of a foreign state
When to deposit/collect
Tax so deducted shall be deposited with government by 7th day of subsequent month
Tax so collected shall be deposited with government by 7th day of subsequent month
Certificate to be issued to seller/buyer
Form – 16A
Form – 27D
The triggering points have been highlighted in Amber
In a nutshell, it can be said that only if conditions of Sec 194Q are not satisfied and the sale of goods exceed Rs 50L where the seller’s TO in previous year is >Rs.10 Cr then Sec 206(1H) shall apply and TCS at the rate as specified.
Vide Notification No. 36/2019 by the Income Tax Department it had substantially modified the format of Part B of Form 16 (Salary TDS Certificate given to Employees) with effect from FY:18-19. Correspondingly, the information to be provided by the employer in Annexure II of Form 24Q-Q4 (Salary Details – providing tax computation of each employee) had also been changed. This came into effect for all Salary TDS Returns (Form 24Q) for FY:2018-19, Quarter 4.
Objective of the Department seems to consolidate information pertaining to the most frequently exercised exemptions & deductions being considered while determining the taxable income.
Break up of Salary and details of exemptions u/s 10 to determine the Total Salary (earlier only Total Salary had to be provided)
Standard Deduction u/s 16(ia) has been included (this is new provision applicable from FY-18-19 onwards)
Break up of Other Income (Other than Salary) – in two broad heads; Income / Loss from House Property and any other Income clubbed together (earlier this was one consolidated value)
Detailed breakup of deductions under Chapter VI (earlier it was only in two broad categories – all sections with a consolidated cap of Rs. 1,50,000 and rest of the sections altogether)
In case the assessee deposits the TDS Payment after the due date of payment of the tax deducted at source, he shall be liable to pay interest @1.5% for every month or every part of the month during which the amount is not deposited with the government.
Interest @ 1.5% is liable to be paid from the date on which the TDS amount was deducted and not from the date the TDS payment was due.
For example:TDS was deducted on 25th June and the due date for TDS Payment was 7th July. The assessee fails to deposit the TDS by 7th July. In such a case, the Interest would be calculated from 25th June and not from 7th July.
The interest is to be calculated as per illustrations below:
Tax Deducted on 26th June, TDS deposited on 9th July (due date was 7th July)
The period of 26th June to 30th June will be calculated as one month (being part of a month month i.e. 30 – 26 = 4 days) & from 1st July to 9th July will also be treated as one month. As such in this case, the interest payable is for two months. Total interest would be 3%. Sounds odd, but it is true – for a delay of 2 days, one has to pay interest for two months.
Note: In the above case, if tax was deducted on 30th June instead of 26th June, the number of days in June is calculated as 30 – 30 = 0 days. As such interest for one month will be charged i.e. only for July.
Tax Deducted on 20th March, TDS deposited on 5th May (due date was 30th April)
The period of 20th March to 31st March will be calculated as one month, 1st April to 30th April will be another month & from 1st May to 5th May will be treated as another one month. As such in this case, the interest payable is for three months. Total interest would be 4.5%. For a 5 day delay, the interest payable is for 3 months.
Logic behind this calculation is that, if dues are not paid on time, the interest for each month (or part thereof) is to be paid right from the date of deduction till date of deposit of the TDS amount. Each month is treated based on the Calendar Month or part thereof, instead of counting the number of days. However, if tax is deducted on the last day of the month, in that case, that month is not counted for calculation of interest.