In the Financial World TDS is Tax deducted at. TDS contributes 40% to the gross direct tax

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2 In the Financial World TDS is Tax deducted at Source TDS contributes 40% to the gross direct tax collections

3 It has been brought with the principle of Pay As you Earn i.e. Collection of Tax in Advance. If no TDS is deducted, expenses are Disallowed u/s 40a(ia).

4 Who : Every deductor When : Where : Within one month of first deduction of Tax TIN FCs/NSDL How : In form 49B

5 1 ST Step 2 nd Step 3 rd Step 4 th Step Deduct Tax as per provision Deposit to Govt Account in Challan 281 File Quarterly statements Issue TDS Certificates

6 Mandatory to quote TAN on Quarterly statements Challans TDS Certificates Other documents pertaining to transactions i) Non obtaining a TAN ii) Non Quoting of TAN iii) Providing false TAN PENALTY OF Rs. 10,000/- in each case (Sec 272BB)

7 Chapter XVII of the Income Tax Act deals with TDS & TCS -Section 190 to 206CA deal with laws and procedures for both TDS and TCS

8 DEDUCTOR- ANY PERSON DEDUCTEE- RESIDENT OR NON RESIDENT RATE OF TDS : SLAB RATE APPLICABLE TO SPECIFIC EMPLOYEES ON THE BASIS OF HIS ESTIMATED INCOME. ON ACTUAL PAYMENT

9 DEDUCTOR - ANY PERSON DEDUCTEE RESIDENT RATE OF TDS 10% LIMIT : >=5000. NOTE: NO TDS IF:- 1. SECURITIES IS IN DEMAT FORM AND 2. IS LISTED ON STOCK EXCHANGE

10 DEDUCTOR- ANY PERSON DEDUCTEE- RESIDENT OR NON RESIDENT RATE -10% LIMIT : >=2500. NOTE : NO TDS ON DIVIDEND EXEMPT U/S 115-O, TDS ON DEEMED DIVIDEND U/S 2(22)(e).

11 DEDUCTOR- PERSON LIABLE TO GET THEIR BOOKS AUDITED DEDUCTEE RESIDENT RATE 10% LIMITS: >=10000 WHERE PAYER IS BANKING CO., CO-OP. SOCIETY BANK, POST OFFICE >=5000 IN OTHER CASE NOTES: NO TDS : 1. PAYMENT IS MADE TO BANK; FINANCIAL CORP. ESTB. UNDER ANY CENTRAL, STATE, PROVINCIAL ACT; PARTNER OF FIRM.. 2. INT. UNDER INCOME TAX 3. ON ZERO COUPOUN BOND Note:- Even if the amount is credited to suspense account or any other account, TDS to be made

12 Person to be an individual or HUF Person to be a Resident Indian Individual should be less than 60 years old Tax calculated on Total Income is nil The total interest income for the year is less than the minimum exemption limit of that year, which is Rs 2,50,000 for financial year the CBDT has issued Notification No. 6/2017to provide that New Form 15G/15H needs to be filed whenever estimated total income changes and new investments are made by the taxpayer.

13 DEDUCTOR ANY PERSON DEDUCTEE ANY PERSON RATE 30% LIMIT : >=10000

14 DEDUCTOR- PERSON LIABLE TO GET THEIR BOOKS AUDITED DEDUCTEE RESIDENT RATE: PAYEE IS IND. OR HUF 1% ANY OTHER ASSESSEE 2% LIMIT: SINGLE CONTRACT >=30000 ANNUAL AGG. AMOUNT >= NOTES : 1. NO TDS IF PAYMENT IS FOR PERSONAL PURPOSE OF IND. OR HUF. 2. NO TDS IF TRANSPORTER FURNISHES HIS PAN, DECLARATION OF HAVING LESS THAN 10 TRUCKS. 3. TDS ON INVOICE VALUE EXCLUDING MATERIALS AMOUNT IF SEPARATELY SHOWN, ELSE ON WHOLE AMOUNT

15 DEDUCTOR- PERSON LIABLE TO GET THEIR BOOKS AUDITED DEDUCTEE RESIDENT RATE : 5% LIMIT: =>15000 NOTE : NO TDS ON PAYMENT BY BSNL & MTNL TO THEIR PCO FRANCHISEES NO TDS ON TRANSACTION RELATED TO SECURITIES

16 DEDUCTOR- PERSON LIABLE TO GET THEIR BOOKS AUDITED DEDUCTEE RESIDENT RATE : FOR USE OF PLANT & MACHINERY 2% FOR USE OF LAND,BUILDING, FURNITURE AND FITTING 10% LIMIT : =>1,80,000 NOTE : 1. TDS TO BE DEDUCTED ON WAREHOUSING CHARGES AND NON REFUNDABLE DEPOSITS ALSO 2. NO TDS ON SERVICE TAX COMPONENT

17 DEDUCTOR PERSON LIABLE TO GET THEIR BOOKS AUDITED DEDUCTEE ANY RESIDENT RATE : 1% LIMIT: >50,00,000 NOTE : NO TDS ON ACQUISITION OF AGRICULTURE LAND.

18 new section 194-IB in the Act provide that Individuals or a HUF (other than those covered under 44AB of the Act), responsible for paying to a resident any income by way of rent exceeding fifty thousand rupees for a month or part of month during the previous year, shall deduct an amount equal to five per cent. of such income as income-tax thereon. tax shall be deducted on such income at the time of credit of rent, for the last month of the previous year or the last month of tenancy if the property is vacated during the year, as the case may be, to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier. In order to reduce the compliance burden, the deductor shall not be required to obtain tax deduction account number (TAN) as per section 203A of the Act. It is also proposed that the deductor shall be liable to deduct tax only once in a previous year.

19 It starts with non-obstante clause to exclude applicability of section 194-IA. The payer or tax deductor would be any person. The payee would be an individual or a HUF being a resident. There is monetary consideration payable under specified agreement WHICH is registered. Tax would be 10%. Tax at source should be deducted at earliest of credit to the account of payee or actual payment of money consideration. No threshold limit provided.

20 DEDUCTOR- PERSON LIABLE TO GET THEIR BOOKS AUDITED DEDUCTEE RESIDENT RATE : 10% LIMIT :=>30,000 NOTE: NO TDS IF PROFESSIONAL FEES PAID BY NON RESIDENT TO RESIDENT THROUGH BANKING CHANNELS AND NON RESIDENT DO NOT HAVE ANY AGENT IN INDIA NO TDS ON PAYMENT MADE BY IND. & HUF FOR PERSONAL PURPOSE.

21 DEDUCTOR ANY PERSON DEDUCTEE NON RESIDENT OR FOREIGN COMPANY RATE : AT THE RATE IN FORCE

22 7 th of Next Month (except for month of March) For March month : It is 30 th April

23 If any person does not deduct or doesn t pay or after so deducting fails to pay whole or part of the tax as required by or under this Act, he or it shall, without prejudice to any other consequences which he or it may incur, be deemed to be an assessee in default in respect of such tax. Such person shall also be liable to pay interest U/s 201(1A) & Penalty.

24 Where the assessee after deducting TDS fails to pay the tax as required by or under this Act Liable to simple 18% p.a [i.e. 1.5% p.m.] from the date on which the tax was deducted till the date on which the payment is actually made. Where the assessee fails to deduct TDS and make the payment as required by or under this Act Liable to simple 12% p.a [i.e. 1% p.m.] from the date on which the tax was deductible till the date on which the TDS deducted.

25 Interest U/s 201(1A) shall be paid before filing TDS returns. Where tax has not been paid after deduction, the tax + interest shall be charged.

26 Section 234 E Applicable to Returns due after 01/07/2012 Non filing & Late filing of TDS, TCS Returns ` 200/- per day maximum to the extent of TDS/TCS To be paid while filing TDS Statement.

27 Form 24Q Quaterly Last Day of Next Month of quarter & 31 st May for the Last Quarter Form 27Q Quaterly As Above Form 26Q Quarterly Same as for Form 24Q, 27Q Form 27EQ Quaterly 15 th of Next month of quarter & 15 th May for last quarter

28 Sec 271C: Penalty equal to the amount that the deductor failed to deduct/collect Prosecution (Sec 276B): If a person fails to pay to the credit of the Central Government, Rigorous imprisonment for a term which shall not be less than three months but which may extend to seven years and with fine.

29 Sr No. Section Reason Penalty / Interest B Non Payment of TDS Prosecution Proceedings with Imprisonment for a Term of 3 months extend up to 7 year (2) Compounding of section 276 B Assesse in default u/s 201(1A) Penalty equals to total of Tax in Arrears 4 40(a)(i)/(ii) Non Deduction of TDS Expenses Are disallowed (2) Demand u/s 156 Additional Interest of 1 % per month

30 6 201(2) After Deduction Non Charge is created Payment on the Asset of the Entity 7 201(1A) Late Payment of TDS Interest is charged at a rate of 1.5 % per month 8 271C On Failure to Deduct TDS as required to be Deducted H Failure to File TDS Return/ Incorrect return Filed Penalty is equal to the amount of failure Penalty of minimum Rs.10,000/- up to Rs.1,00,000/- Rs. 200/- Per Day E Fees for Late Filing TDS Return A (2) Non Issuance of TDS Rs. 100/- per Day Certificate BB Non Compliance of Penalty of Provision under sec Rs.10,000/- 203 A

31 EVERY PERSON WHOSE TDS IS DEDUCTED IS MANDATORY REQUIRED TO FURNISH PAN.FROM THIS F.YR IT IS MANDATORY FOR TCS TOO NON FURNISHING THE PAN SHALL LET TAX TO BE DEDUCTED/COLLECTED AT THE HIGHER OF THE FOLLOWING : AT THE RATE SPECIFIED IN THE ACT. AT THE RATE IN FORCE AT THE RATE OF 20%.

32 CONCEPT OF TCS: In this concept the seller of specified goods collect tax from the buyer under the section 206C (1). The whole concept of TCS is from the income tax act is to widen the income tax scope and to include more and more persons into tax grip.

33 Buyer is a person who buys the goods for sale. The mode of buying may be direct purchase, tender or any auction to the specified goods. These are not covered as buyers under the section: - Central/State government. - Public company. - Embassy, High commission or representation of foreign country. - Any club. - Any person who buys the goods for personal consumption & not for sale.

34 Seller of the specified goods is covered in TCS act. Seller may be - individual or huf - firm - co-operative society - company - state or central government - local authority

35 Specified goods are those goods, sale or purchase of which attracts TCS. The list of such goods is: 1- Alcoholic liquor for human consumption. 2- Timber 3- Tendu leaves. 4- Forest produce other than timber and tendu leaves. 5- Scrap or waste 6- Minerals 7- Toll plaza & Parking Lot 8- Minerals being Coal or lignite or iron ore ( )

36 Alcoholic liquor for human consumption 1% Timber 2.5% Tendu leaves 5% Forest produce other than timber and tendu leaves 2.5% Scrap 1% Minerals 2% Toll plaza, Parking lot, Mining and quarrying * 2 %

37 The TCS will be zero or exempt when the buyer buys the goods for manufacturing or Reproduction and not for sale. In this condition the buyer supplies Form 27C to the seller mentioning that he is the not a trader and will reprocess the goods which are purchased with duly stamped and signature. The seller needs to deliver copy of Form 27C to the Commissioner of income tax.

38 Time limit for TDS / TCS Certificates: Form 16 To be issued annually, within 15 days from due date of filing of TDS/TCS statements. Form 16A Within 15 days from due date of filing of TDS/TCS statements Form 27D Within 15 days from due date of filing of TDS/TCS statements

39 TRACES is a web-based application of the Income Tax Department that provides an interface to all stakeholders associated with TDS administration. It enables viewing of challan status, downloading of NSDL Conso File, Default reports, making correction in statement, allows to correct PAN, A.Yr and download TDS Certificates Form 16 / 16A.

40 CPC (TDS) for Deductors TRACES: Dashboard Statement Status and Default payable Deductor Compliance Profile Online Corrections View Defaults Summary Online PAN Verification Statement and Challan Status Downloads TDS Certificates Form 16/ 16A Form 27D Transaction Based Report for Non Residents Consolidated Statement File Justification Reports e-tutorials and FAQs Circular and Notifications CPC (TDS) Communications TAN PAN Consolidated File 13 October

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43 Statement Status Challan Status Challan Status for statement View TDS/TCS Credit Pan Verification Request for Conso File 197 Certificate validation Request for refund Track Correction Request Declaration for Non- filing of Statement Declaration to Deposit Lower TDS OLTAS Challan Correction Request for 26A/27BA

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45 Click here to agree the declaration Click here to go to challan status. If challan is not consumed in any statement, detail will not be displayed Click on Cancel and go to previous page If the user disagree to the declaration, gets two option either add another challan or move back to the challan detail page to accept the declaration 45

46 Furnish Form 26B acknowledgement to your Jurisdictional Assessing Officer within 14 days from the date of transmitting the data electronically. Failing to do so will lead to rejection of your refund request. View the 26B acknowledgement 46

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48 OLTAS Challan Correction

49 OLTAS Challan Correction

50 Request for 26A/27BA

51 View Default Summary Request for Correction Request for Justification Report Download Track Correction Request View Saved Statement Correction Ready for Submission Tag/Replace Challan Track Request for Tag/Replace Challan

52 This feature enables the Deductor to file Online Correction statements through TRACES portal without downloading TDS/TCS Consolidated File. Following facilities are allowed in Online corrections: PAN Correction Challan Correction Modify Salary details Add challan to statement Modify/Add deductee row Movement of Deductee Rows Update of Personal Information Pay 220I, Late Payment, Late Deduction and Late Filing Interest

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54 Pay 220I, LPI, LDI and LF Select Pay 220I, LP,LD, Interest, Late filing, Levy from drop down

55 Inbox- Contains notices, intimations from TDS-CPC Request For resolution Resolution Tracking Declaration for Paperless Intimation Notices from Assessing Officer

56 Requested Downloads Form 16/16A/27D Transaction based Report Download Challan Status Inquiry View Your BIN-For Govt. Deductors

57 Aggregated TDS Compliance Functionality If a PAN is associated with more that one TANs for example PAN of the Central Office, Headquarter etc. having more that one TAN of its branches, said PAN can review the "Aggregated TDS Compliance" report on a regular basis to improve TDS compliance at Organization level. PAN can view TDS performance for all of its respective TANs by logging into TRACES as a Taxpayer. The download of the list of defaults of various TANs associated with a PAN will be available in Excel Format for which a request has to be placed.

58 Aggregated TDS Compliance Download Request Page Default can be viewed across all F.Y from F.Y onwards for all TANs Drop Down Values: Total Default, Short Deduction, Short Payment and so on

59 In TRACES website, e-tutorial is given, which is self explanatory. Will help to resolve your problems without coming to the department.

60 THANK YOU