TDS Compliances, and Interest on Late Payment of TDS

TDS COMPLIANCES

Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) is one of the essential concepts of the Income Tax Act 1961. Every registered assessee who is liable to deduct TDS or TCS shall collect/deduct tax and the same will be deposited within the prescribed time limit as per the Government.

BASIC GUIDELINES FOR ASSESSEE LIABLE TO DEDUCT TDS/TCS

He shall quote the Tax Deduction/ Collection Account Number on all the documents pertaining to TDS/ TCS.
He shall collect or deduct the tax amount as per the applicable rate.
He shall file TDS or TCS return periodically
He shall issue a TDS or TCS certificate in respect of the tax amount deducted or collected.

DUE DATES FOR FILING TDS/TCS RETURN

Quarter	For TDS Return	For TCS Return
Apr – June	31st July	15th July
July - Sep	31st October	15th October
Oct-Dec	31st January	15th January
Jan – Mar	31st May	15th May

Interest on Late Payment of TDS

Along with the late fee you have to pay interest as per section 201A. The below table describes the method of interest calculation:

Type of Default	Interest Rate	Period
Non-deduction of Tax at source in whole or in part	1% per month	From the due date on which tax supposed to get deducted to the date on which tax is actually deducted
Non-payment of tax after deduction either in whole or in part	1.5% per month	From the date of Tax deducted to the date of payment

PENALTY U/S 234E

If a person fails to file a return on or before the due date then as per section 234E of Taxation rules he needs to pay a fine of Rs. 200 until the date you file the return.

*But the maximum amount of penalty that the person needs to pay on late filing is Rs. 5000/- only.

PENALTY U/S 271H

If a person fails to file a statement of Tax Deducted/ Collected at the source on or before the due date then the assessing officer may impose a penalty under section 271H.
The amount of penalty which he can levy is Rs. 10,000 but not go beyond Rs. 1,00,000

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