Tax Deducted At Source (TDS)

TDS means Tax Deducted at Source. It is the amount deducted from payments of various kinds such as salary, contract payment, commission, etc. This deducted amount can be adjusted against the tax due to the deductee. Rate of TDS starts from 1% and goes upto 20% or more depending upon the transaction.

TDS return

TDS return is a quarterly statement that is to be given to the Income Tax department about the payments made and Tax deducted on the same along with deductee details and details of such Tax deposited. 

It is necessary to submit the TDS returns on time. TDS return filing can be done completely online. Once the TDS returns are submitted the details will come up on Form 26 AS of he deductee. While filing the TDS returns the various details to be mentioned are:

• PAN of the deductor and the deductee.
• Amount of tax that is paid to the government
• TDS challan information
• Others details

Who need to file TDS Return

A person with a valid TAN - Tax Collection and Deduction Account Number - can file for an online TDS return. Any individual or business that makes a particular payment stated under the Income Tax Act needs to deduct tax at source. The deposit for the same has to be made within the stipulated time. The payment categories include:

• Salary
• Insurance commission
• Income from winning horse races
• Income by way of 'Income on Securities'
• Income by way of winning the lottery, puzzles, and others
• Payment in respect of National Saving Scheme and many others

An assessee can submit an e-TDS return if the same was deducted from their income. As mentioned earlier, it is the obligation of the assessee to file within the due date or be liable to pay the penalty for delay. The categories of assessees eligible to electronically file TDS return every quarter are:

• Company
• Persons whose accounts are audited u/s44AB
• Persons holding an office under the Government

TDS Return Form

A TDS (Tax Deducted at Source) return form is a document used to report tax deductions made from an individual's or organisation's income. It is filed with the Income Tax Department of India and is used to ensure that the individual or organisation pays the correct amount of tax.

The TDS return form consists of details such as the taxpayer's name and PAN (Permanent Account Number), the tax deductor's name and TAN (Tax Deduction and Collection Account Number), the period of tax deduction, and the total amount of tax deducted. It also includes details of the tax deductible at sources, such as the nature of the payment, the amount paid, and the rate at which the tax was deducted.

TDS return forms can be filed electronically or through a physical form. It is important to file the TDS return form on time to avoid any penalties or fines. The return forms are the following:

• Form 24Q, 
• Form 26Q
• Form 27Q
• Form 27EQ
• Form 27D 

Each one has a different purpose but connected with income tax.

Form 24Q:

The form information is based on salary payments and the deductions made for tax.

The declaration and payment is to be made quarterly by companies and firms in India.

Details such as Deductor, Deductees, Challans as well as Salary TDS have to be provided.

Form 26Q:

This form is based on their payments other than salary.

It has to be filled up for declaration by people who are living and working in India and are Indian citizens.

This form is payable under the sub - section (3) of section 200 of the Income tax Act, 1961.

The sections under which the form is based on, and can be used for reference to fill in the declaration form include sections 193, 194, 194A, 194BB, 194C, 194D, 194EE, 194F, 194G, 194H, 194I, 194J, 194LA and rule 31A.

Form 27D:

This is a Certificate under section 206C of the Income tax Act, 1961 for tax that is collected at source.

TCS is basically the tax that is collected by Seller from Buyer of certain goods when debiting the amount payable to the account of buyer by buyer or when receiving the amount from the buyer in the form of cheque, cash, demand draft or other modes of payment for selling certain prescribed goods as per the Section 206C (1) for the purpose of business and not for personal use.

TCS is chargeable, as mentioned in the form for:

• Alcoholic Liquor that is meant to be consumed by humans.
• Tendu leaves
• Timber obtained from a forest which is under a lease
• Timber that is obtained from any other forest that is not on lease.
• Any other forest produce other than timber and tendu leaves, and Scrap

TCS Amount is paid and filed in Challan 281 within a week from the final day of the month in which tax is supposed to be collected. TCS Certificate in Form 27D is issued to Buyer.

Form 27Q:

This form has to be filled up for declaration of TDS returns in detail by NRIs and foreigners

This form is based on the payments of foreigners and NRIs other than salary.

This is a quarterly tax deduction statement under the subsection (3), Section 200 of the Income tax Act, 1961.

Form 27EQ:

The form is made under the section 206C of the Income Tax Act.

TCS is basically the tax that is collected by Seller from Buyer of certain goods when debiting the amount payable to the account of buyer by buyer or when receiving the amount from the buyer in the form of cheque, cash, demand draft or other modes of payment for selling certain prescribed goods as per Section 206C (1) for the purpose of business and not for personal use.

Form 24Q and 26Q Due Dates

Form 24Q is a statement for TDS from salaries, which must be filled and submitted by the deductor on a quarterly basis.

· For the quarter ending 30th June, the E-TDS return due date for both 24Q and 26Q will be July 31. 

• For the quarter ending 30th September, the due date will be 31st October. 
• For the quarter ending 31st December, the due date will be 31st January. 
• For the quarter ending 31st March, the due date will be 31st May.

Form 24Q E-TDS Annual Returns

Form 24Q has to be filled in to file annual return of salaries, and the details that have to be entered in the form include Tax Deduction Account Number, Permanent Account Number, the name of employer, the category under which employer falls, the business address of employer, etc. A number of details with regards to the salary paid and the amount of money deducted as tax on it will also have to be disclosed in the form, as well as information regarding the tax deducted and paid to the credit of the central government.