Saturday 26 April 2014

CPC(TDS) communication regarding Short Deduction defaults in TDS Statements

Date of communication : 25/04/2014

Dear Deductor,

CPC(TDS) feels glad to bring to you easy tips to avoid Defaults in your TDS statements, by way of adherence to the following basic principles:

· Timely Payment of total taxes deducted/ collected
· Correct Reporting with regard to PANs, Tax Rate and Challans
· Complete Reporting for all Deductees
· Timely filing of TDS Statements

Following are some important facts to be adhered to, while submitting TDS statements, to avoid each type of Default:

· Late Payment Defaults:

o The taxes deducted must be deposited within the due dates, as prescribed by Rule 30 of the Income Tax Rules 1962.

o Please also refer to our communication on Important Guidelines for payment towards liability on account of Tax Deducted / Collected at Source

· Short Payment Defaults:

o All the taxes deducted must be deposited with challan 281 quoting correct TAN, Assessment Year, Minor Head etc.

o Challan details/BIN details quoted in the statement should be correct. Challans can be validated by using Challan Status Inquiry(CSI) file. Correct details can also be verified at TRACES in “Challan Status” menu under “Statement Status” after login.

o There should not be any difference in the amounts quoted in “Deducted” and “Deposited” columns of the deductee rows.

o Challans quoted in the statement must have balance available for consumption against specified deductee rows. Available balance can be verified at TRACES in “View Consumption Details” under “Statements/ Payments” menu after login.

o Government Deductors need to report Book entry flag as “Y” in challan details.

· Short Deduction Defaults:

o Taxes must be deducted at correct rates specified in the Act. The Rate table can be accessed at TRACES for correct tax rates.

o Correct flags (A, B, C, T and Y) must be raised for no deduction/ lower deduction/ higher deduction, as appropriate.

o The PAN for deductees must be valid and correct. TAN-PAN Mastercan be downloaded from TRACES and be used to file statement to avoid quoting of incorrect and invalid PANs.

o Correct and valid 197 Certificates must be specified. E-tutorialcan be referred to for the purpose of validation.

o For 24Q statements, correct flags should be raised for Woman/ Man/ Senior Citizen/ Super Senior Citizen deductees, as may be appropriate.

o DTAA flag “B” must be raised under section 195 of the Act, at the time of filing 27Q statements.

· Late Deduction Defaults:

o Taxes must be deducted at the time of Payment or Credit, whichever is earlier.
· Late Filing Defaults:
o Quarterly TDS/TCS statements must be filed within due dates of filing statements as prescribed by Rule 31A of the Income Tax Rules, 1962.The due date to file TDS statements for Q4, FY 2013-14 is 15th May, 2014.

o Please refer to our communications CPC (TDS) Reminder for filing of TDS Statements within Due Date and CPC (TDS) Communication-Circular 07/ 2014 for Late Fee Levy for Government Deductors in this regard.

For any further assistance, please refer to the FAQs ande-tutorials available on TRACES, before reaching out to uson contactus@tdscpc.gov.in or call our toll-free number 1800 103 0344.

CPC (TDS) is committed to provide best possible services to you.
CPC (TDS) TEAM

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