Reason for Mismatch of TDS & Correction Statement

MISMATCH OF TDS

1. A major problem noted across the country is that of mis-match of TDS payments claimed by the deductees in their returns of income vis-à-vis the TDS payments reflected by the deductors in their e-TDS returns and also the non reflection of the TDS payments in the system, in case the e-TDS returns have not been filed by the deductors.

2. As per the present procedure, all payment of Direct Taxes, either by way of TDS / TCS, Advance-tax, Self-Assessment Tax and Regular Tax are uploaded to the credit of the concerned assessee in the computer systems. The Assessing Officers give credit to the taxes, when they are uploaded to the account of the concerned assessee through the national network of the Income-tax Department. In case of TDS / TCS, unless the deductors correctly upload the details of the deductions including the PAN and the amount, the taxes cannot be given credit in the account of the concerned deductee.

3. In all cases where there is a mis-match, the tax credits cannot be given, resulting in withholding of refunds and also creation of infructuous demand.

Main reasons for TDS mismatch

Deductor related reasons :
• Non filing of quarterly TDS statements • Omission to include details of challan in TDS statement
• Quoting wrong CIN in challan details in the TDS statement
• Entering wrong amount in challan details
• Quoting of wrong TAN in the challan while remitting the TDS in the bank
• Quoting of wrong minor head in the challan while remitting the TDS
• Omission to include details of a deductee in the challan wise annexure in the TDS statement
• Non quoting of PAN of the deductee
• Quoting of structurally invalid PAN of the deductee
• Quoting of valid but non existent PAN of deductee
• Quoting of valid but incorrect PAN of deductee
• Entering incorrect amount in deductee details

Deductee related reasons :

• Error in the TDS amount claimed in the return
• Claim of inflated TDS credit in the return
• Bogus claim of TDS credit in the return
• Amount paid / credited shown in the TDS certificate erroneously claimed as TDS credit in the return
• Erroneous claim of TDS credit pertaining to two years in the return of income for one year
• Quoting of incorrect TAN of the deductor in the return
• Quoting of the TAN of the last DDO only in case of salary
drawn from different DDOs during the year
• Credit for TDS claimed in a different PAN and status
• Credit for TDS claimed for an assessment Year other than
the assessment year relevant to the year of deduction
Bank related reasons :
• Entering wrong TAN while uploading challan data
• Entering wrong minor head code while uploading challan data
Correction statements for correcting the mistakes in TDS statements

Type of correction statement	Nature of corrections that can be made
C-1	Updation of deductor details – Name, address etc.
C-2	Updation of challan details
C-3	Updation of deductee details including addition of new records and deletion of existing records
C-4	Updation of salary detail records – deletion of existing records and addition of new records
C-5	Updation of PAN of deductees
C-9	Addition of challan records and underlying deductee records
Y	Cancellation of TDS statement filed with incorrect TAN

Action to be taken by deductors for various types of errors

Nature of error	Type of correction statement to be filed or other action to be taken
Omission to include details of a challan	C-9
Entering of wrong CIN in challan details	C-2
Entering of incorrect amount in challan details	C-2
Quoting of wrong TAN in challan	Approach TDS A.O for correction in the system
Quoting of wrong minor head code in challan	Approach TDS A.O for correction in the system
Omission to include details of a deductee in the challan wise break-up	C-3
Non quoting of PAN of a deductee	C-5
Quoting of invalid PAN or non existent PAN or incorrect PAN of a deductee	C-5
Entering incorrect TDS amount in deductee details	C-3
Entry of wrong TAN by the bank while uploading challan data	Approach TDS A.O for correction
Entry of wrong minor head code by the bank while uploading challan data	Approach TDS A.O for correction