TCS RETURN FILING

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TCS Return Filing Modern Entrepreneur.

It is a matter of general belief that taxes on income and wealth are of recent origin but there is enough evidence to show that taxes on income in some form or the other were levied even in primitive and ancient communities. 

The rapid changes in administration of direct taxes, during the last decades, reflect the history of socio-economic thinking in India. From 1922 to the present day changes in direct tax laws have been so rapid that except in the bare outlines, the traces of the I.T. Act, 1922 can hardly be seen in the 1961 Act as it stands amended to date. It was but natural, in these circumstances,

TCS RETURN FILING

Computerisation in the Income-tax Department started with the setting up of the Directorate of Income tax (Systems) in 1981. Initially computerisation of processing of challans was taken up. For this 3 computer centres were first set up in 1984-85 in metropolitan cities using SN-73 systems. This was later extended to 33 major cities by 1989. The computerized activities were subsequently extended to allotment of PAN under the old series, allotment of TAN, and pay roll accounting. These computer centres used batch process with dumb terminals for data entry.
In 1993 a Working Group was set up by the Government to recommend computerisation of the department. Based on the report of the Working Group a comprehensive computerisation plan was approved by the Government in October, 1993. In pursuance of this, Regional Computer Centres were set up in Delhi, Mumbai, and Chennai in 1994-95 with RS6000/59H Servers. PCs were first provided to officers in these cities in phases. The Plan involved networking of all users on LAN/WAN. Network with leased data circuits were accordingly set up in Delhi, Mumbai and Chennai in Phase-I during 1995-96. A National Computer Centre was set up at Delhi in 1996-97. Integrated application software were developed and deployed during 1997-99. Thereafter, RS6000 type mid range servers were provided in the other 33 Computer Centres in various major cities in 1996-97. These were connected to the National Computer Centre through leased lines. PCs were provided to officers of different level upto ITOs in stages between 1997 and 1999. In phase II offices in 57 cities were brought on the network and linked to RCCs and NCC.

Procedure for TCS/ TDS return filing in the ITD e-filing portal

Visit ITD’s e-filing home page (ITD e-filing) and login using TAN and Password

After successful login, go to TDS menu >> Upload TDS

FVU Version, Financial Year, Form Name, Quarter and Upload Type (Regular / Correction) and verify.

 

Browse the TDS return filing zip file generated using Sarala TDS

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Key Points of TDS Deduction & Payment

Payment of TDS Deducted

The tax deducted at source (TDS) while making payment to parties for qualified expenses must be deposited before 7th of next month. For example, the TDS deducted in November 2017 is payable on or before 7th December 2017. The challan number for making TDS deposit is 281. while making TDS Payment care must be exercised while selecting the appropriate section/nature of the payment.

 

The Consequence of Non-Compliance

The non-compliance of TDS provisions is a grave offence and is punishable under section 271 (C) of the Income Tax Act 1961, wherein the minimum penalty is 10,000 which can go up to Rs. 1,00,000/-. Further section 276B applies to all such cases where a willful default is established, in all those cases the punishment is 3 Years rigorous imprisonment which can go up to seven years.

 

Interest on Non Payment of TDS

The TDS deducted by a person need to be deposited within 7th day of the next month. Any failure or delay in depositing the TDS is punishable under section 271 C or/and Section 276 B. The defaulter is further liable to pay interest on delayed payment at the rate of 1.5% per month or part thereof. There is no provision in law where the interest can be waived; hence the assessee should be very careful.

 

Filing of TDS Return

After making the payment of TDS to the income tax, the taxpayer is required to file a quarterly return where the TDS deposited is mapped against the PAN of the person from which TDS was deducted. The TDS Return is filed within 30th of the month succeeding the quarter. For example, the first quarter ends on 30th June, hence the TDS Return must be submitted before 30th July.

 

Interest on Non-Deduction of TDS

When a person while making payment for which he ought to have deducted TDS fails in deducting TDS or deducts an amount less than the required amount. In all such cases, the deductor is liable to pay an interest @ 1% per month or part of the month, till the date on which TDS is deducted. Hence, a businessperson must be prudent while making payment to parties and ensure that TDS is deducted.

 

Other Consequences of Default on TDS

The expenses on which TDS was required to be deducted shall be disallowed as an expense under section 40(a) while computing the total taxable income. To understand it quickly let’s take an example of business where the income is 10 lac and the expense is also 10 lac, then effectively there shall be zero income tax, However, if the TDS is not deducted then the tax shall be three lacs (30% of 10 lac)

 

TDS Rate Chart for The FY-2019-2020 (AY: 2020-21)

SectionNature of PaymentBasic Cut-off (Rs.) Per AnnumIndividual and HUFOther Than Individual/HUFPAN is not Submitted
192
Payment of Salaries by Employers
Slab rate
Slab rate
Not applicable
30%
192A
Premature payment by PF Organization from EPF A/c (i.e. before 5 Years).
50,000
10%
Not applicable
20%
193
Payment of Interest on Securities by company
10,000
10%
10%
20%
194
Payment of Dividend other than dividend as referred to Section 115O by company (i.e. Dividend on which Dividend Distribution Tax is not paid)
2,500
10%
10%
20%
194A
Payment of Interest by bank
40,000 (Non Sr.Citizen) 50,000 (Sr. Citizen)
10%
10%
20%
194A
Payment of Interest by others
5,000
10%
10%
20%
194B
Payment of prize from Wining from Lotteries by any person.
10,000
30%
30%
30%
194B
Payment of prize from Wining from Horse Race by any person.
10,000.00
30%
30%
30%
194C
Payment to Contractors by any person.
30,000 (Single bill) or 1 Lakh aggregate bills during the year.
1%
2%
20%
194C
Payment to Transporter Covered u/s. 44E and submit declaration in prescribed format. (i.e. owning less than 10 goods carriages)
0
0
20%
194C
Payment to Transporter not covered u/s. 44E (i.e. owning more than 10 goods carriages)
30,000 (Single bill ) or 75,000.00 aggregate bills during the year.
1%
2%
20%
194D
Payment of Insurance Commission to agents by Insurance Company.
15,000
5%
10%
20%
194DA
Payment in respect of maturity of Life Insurance Policy by Life Insurance Company.
1 Lakh
1%
1%
20%
194DE
Payment to NRI sportsman or association by any person or organization
20%
20%
20%
194EE
Payment out of deposit under National Saving Scheme (NSS)
2,500
10%
10%
20%
194F
Payment with respect to repurchase of units by Mutual Fund Companies.
20%
20%
20%
194G
Payment of Lottery Commission
15,000
5%
5%
20%
194H
Payment of commission or Brokerage
15,000
5%
5%
20%
194I
Payment of rent on land, building, furniture and fittings.
240,000
10%
10%
20%
194I
Payment of rent on plant, machinery or equipments.
240,000
2%
2%
20%
194IB
Payment made on account of transfer of immovable property other than agriculture land.
50 Lakh
1%
1%
20%
194IA
Rent payable by individual not covered u/s. 194I for land, building, furniture and fittings
50,000 PM
5%
5%
20%
194J
Payment of Professional Fees other than call centers
30,000
10%
10%
20%
194J
Payment of Professional Fees to call centers.
2%
2%
20%
194LA
Compensation on transfer of certain immoveable property than Agriculture Land
250,000
10%
10%
20%

Section

Nature of Payment

TCS Rate (%)
206C
Scrap
1
206C
Tendu Leaves
5
206C
Timber obtained under a forest lease or other mode
2.5
206C
Any other forest produce not being a timber or tendu leave
2.5
206C
Alcoholic Liquor for human consumption
1
206C
Parking Lot, Toll Plaza, Mining and Quarrying
2
206C
Minerals, being coal or lignite or iron ore (applicable from July 1, 2012)
1
206C
Sale of motor vehicle of the value exceeding Rs. 10 Lacs (wef 01.06.2016) Motor vehicle clause not applicable on Central Government, a State Government, an embassy, a High Commission, Legation, Commission, Consulate and the Trade Representation of a foreign State; Local Authority; a Public Sector Company which is engaged in the business of carrying passengers (wef 01.04.2017)
1
Note: TDS deducted in a month is required to be paid before 7th day of next month. While making TDS mention correct section in the challan number 281. For TDS payment use separate challan while making payment for specific type (section). Interest on Late Payment is- 1.5% per month or part thereof, The penalty on Late filing of TDS Return is Rs. 200 per day, however it is limited to the TDS amount.

FAQ

e-TDS/TCS return has to be prepared in the data format issued by e-Filing Administrator. This is available on the Income Tax Department website (www.incometaxindia.gov.in) and Protean e-Gov-TIN website (www.tin-nsdl.com). There is a validation software (File Validation Utility) available along with the data structure which should be used to validate the data structure of the e-TDS/TCS return prepared. The e-TDS/TCS return should have following features

Protean e-Gov has made available a freely downloadable Return Preparation Utility for preparation of e-TDS/TCS statements. Additionally, you can develop your own software for this purpose or you may acquire software from various third party vendors. A list of vendors, who have informed Protean e-Gov that they have developed software for preparing e-TDS/TCS statements, is available on the Protean e-Gov

 

Form No. 27A is a control chart of quarterly e-TDS/TCS statements to be filed in paper form by deductors/collectors alongwith quarterly statements. It is a summary of e-TDS/TCS returns which contains control totals of ‘amount paid’ and ‘income tax deducted at source’. The control totals of ‘amount paid’ and ‘income tax deducted at source’ mentioned on Form No. 27A should match with the corresponding control totals in e-TDS/TCS return. A separate Form No. 27A is to be filed for each e-TDS/TCS return.

 

e-TDS/TCS return should be prepared in accordance with the data structure (File Format) prescribed by the e-filing administrator

Bank Challan Number is a receipt number given by the bank branch where TDS is deposited. A separate receipt number is given for each challan deposited. You are required to mention this challan number in the e-TDS/TCS return.

Reserve Bank of India has allotted a unique seven-digit code to each bank branch.You are required to mention the code of the bank branch where TDS is deposited in the e-TDS/TCS return. You can get this code from the bank branch where TDS amount is deposited.

 

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