NATURE & REMEDIES. A Presentation by K.M. SHAHI, ITO(TDS) 2(4), MUMBAI

Transcription

1 NATURE & REMEDIES A Presentation by K.M. SHAHI, ITO(TDS) 2(4), MUMBAI

2 DEFAULTs u/s. 201(1) & MISMATCHEs u/s. 200A Reasons for Default Types of Default How to Correct? What is the Advantage?

3 Show Cause Notice U/s. 201(1) of I.T. Act, 1961

4 How do we react to Show Cause Notice (SCN) from TDS? A. Treat it like any other Notice. C. SCN is a mischief by Assessing Officer B. SCN is outcome of system trouble. D. No need to bother, once the dues have been paid.

5 Deductor sresponse to Show-Cause Notice? Response is very poor: In about 20 25% cases Photocopy of Return/ Challans are enclosed. No attention paid to the direction in SCN Person who attends, knows nothing about TDS Generally, system is blamed.

6 Show Cause Notice U/s. 201(1) of I.T. Act, 1961

7 Report on Short deduction/collection

8 Report on Short Payment/Non-Payment

9 Report on Interest Payable on Late Payments

10 Reasons for Default Steps involved Assessee deposits TDS in Bank Assessee files TDS Return with CIN* & Deductee details Bank Transmits CIN* TIN-NSDL Assessee files Correction Return ITD System Processes Show Cause Notice to Assessee *CIN Challan Identification Number Contains TAN + AMOUNT + DATE OF DEPOSIT + BSR CODE + CHALLAN SR. NO. Match ed? Y E S NO End

11 The Data Flow TAXPAYER BANKS CENTRAL NSDL SYSTEM TIN- SITE TIN-FC ITD DEDUCTOR

12 The Responsibility of Data Handling BANKS DEDUCTORS CIN Details TAN AMOUNT BSR Code Challan Sr. No. Date of Deposit CIN Details + Deductee Details TIN -NSDL BULK PROCESSING ON ITD SYSTEM

13 Possibility of Error while Data Handling BANKS DEDUCTORS CIN Details TAN AMOUNT BSR Code Challan Sr. No. Date of Deposit CIN Details + Deductee Details Computerized Less probable Manual More probable

14 Possibility of Error while Data Handling BANKS (10%) [Assigning Equal Weightage to Each Variables ] TAN AMOUNT BSR Code Challan Sr. No. Date of Deposit TAN Manual : Bank/Assessee Amount Computerized/Matched BSR Code Computerized Challan Sr. No. Computerized Date Computerized

15 Possibility of Error while Data Handling Deductor (90%) CIN Info-Manual TAN AMOUNT BSR Code Challan Sr. No. Date of Deposit Deductee Details- PAN Section Amount Date of Deduction Date of Deposit Some Common Errors Challan Splitting Challan Combining Wrong TAN/PAN data Wrong Amount Wrong Challan Sr. No. Wrong Date Wrong Section/Sub-section Non-Marking L / P / B / C etc.

16 Types of Default Non-marking of L deduction (197 Cases) Quoting Incorrect Section/Sub-section Referring to an outdated Rate chart Short deduction Considering wrong amount of payment Wrong amount of Payment Indicating wrong Deductee code Wrong gender of Employee Wrong Salary / Exemption information

17 Types of Default Non-marking of B for 4 th Quarter E-payment after 8:00 p.m. No interest paid in case of delay Late Payment Less interest paid for delayed payment Wrong CIN quoted for Interest Challans Wrong linking of Challan Deductions TDS paid by cheque, realized after due date TDS paid 1 day late, bank holiday on due date.

18 Types of Default Splitting of Challan Short Payment / Non- Payment Combining of Challan Practically not paid and applied some dummy CIN Mistake in quoting the CIN* Wrong minor code *Challan Identification Number Contains TAN + AMOUNT + DATE OF DEPOSIT + BSR CODE + CHALLAN SR. NO.

19 Screen-shot of Unmatched Challan

20 Rectification of Errors Deductor Files CORRECTION STATEMENT RETURN IS PROCESSED Default Is Removed

21 Rectification of Errors TYPES OF CORRECTIONS CORRECTIONS IN CHALLAN DETAILS CORRECTIONS IN e-tds STATEMENTS ASSESSING OFFICERS BANKS DEDUCTOR

22 Rectification of Errors CORRECTIONS IN CHALLAN DETAILS ASSESSING OFFICERS (TDS) ASSESSMENT YEAR TAN SECTION CODE (94C/94J etc.) MINOR HEAD CODE (400/200) FORM NUMBER (24Q/26Q etc.) BANKS NAME OF THE DEDUCTOR AMOUNT MAJOR HEAD CODE (20/21) From Sept 2011, the Banks will be allowed to correct A.Y., TAN, Section Code & Minor Head code, if approached within 7 days.

23 Rectification of Errors CORRECTIONS IN e-tds STATEMENT Data structure (File Format) D E D U C T O R S For statements pertaining to FY and onwards File Format 24Q Correction Q1 to Q3 Version 4.3 File Format 24Q Correction Q4 Version 4.3 File Format 26Q Correction Q1 to Q4 Version 4.3 File Format 27EQ Correction Q1 to Q4 Version 4.3 File Format 27Q Correction Q1 to Q4 Version 4.3 For statements up to FY and onwards File Format 24Q Correction Q1 Q3 Version4.0 File Format 24Q Correction Q4 Version4.0 File Format 26Q Correction Q1 Q4 Version4.0 File Format 27EQ Correction Q1 Q4 Version4.0 File Format 27Q Correction Q1 Q4 Version4.0

24 CORRECTIONS IN e-tds STATEMENT For statement pertaining to FY and onwards D E D U C T O R S C1 - Correction in deductor details C2 - Correction in challan and deductor details C2 - Correction in challan details C3 - Correction in challan and deductee details C3 - Correction in deductee details C3 - Correction in deductor and deductee details C3 - Correction in deductor, challan and deductee details C4 - Correction in salary details records C5 - Correction in deductee PAN in deductee detail records C5 - Correction in deductee PAN in salary detail records C5 Correction in deductee PAN in deductee and salary detail records C9 - Addition of challan Multiple batch correction statement - correction in deductor, challan (updation and addition), deductee details (including PAN) Y - Cancellation of statement

25 CORRECTIONS IN e-tds STATEMENT For TDS Statement up to FY D E D U C T O R S C1 - Correction in deductor details C2 - Correction in challan and deductor details C2 - Correction in challan details C3 - Correction in challan and deductee details C3 - Correction in deductee details C3 - Correction in deductor and deductee details C3 - Correction in deductor, challan and deductee details C4 - Correction in salary details records C5 - Correction in deductee PAN in deductee detail records C5 - Correction in deductee PAN in salary detail records C5 Correction in deductee PAN in deductee and salary detail records C9 - Addition of challan Multiple batch correction statement - correction in deductor, challan (updation and addition), deductee details (including PAN) Y - Cancellation of e-tds Statement

26 Rectification of Errors Points to be remember while depositing TDS/TCS Select correct minor head code (200) while making TDS/TCS deposits Select correct minor head code (400) while making regular TDS/TCS payments arising out of Order u/s. 201(1)/201(1A)/271C or 272A(2)(k) etc. Ensure due diligence in quoting TAN, section code and assessment year while making TDS/TCS deposits For deducting TDS/TCS refer to latest chart/rules for TDS/TCS rates On due date deposit tax before hours ( i.e. 8:00 p.m.) to avoid interest for late payment.

27 In Nutshell Garbage In Garbage Out

28 In Nutshell Garbage In Garbage Out GARBAGE DATA PERFECT DATA PERFECT MODEL GARBAGE MODEL GARBAGE RESULTS GARBAGE RESULTS PERFECT DATA PERFECT MODEL PERFECT RESULTS DEDUCTOR GOVT. ALL

29 The Ultimate Advantage DEDUCTOR TIN-FC 1. TDS Paid/ Stmt filed 2. OLTAS + Stmt. 4. Tax Credit 26AS 3. Statement + OLTAS DEDUCTEE ITD

30 The Ultimate Advantage

31 For Details on e-tds Statements & Various Other Queries Please Log On To

32 for being such a wonderful audience. >> > K.M. SHAHI.