TDS -Provisions

Tax deduction at source is now a very important subject in the field of taxation in the wake of changes in compounding of offences rules that we have already discussed here

Although TDS provisions were already present way back since 1996 but now they have almost covered all facets in any concern.There are numerous payments that are made in a business some instances of which are as follows

Interest,Rent,Salary,Remuneration etc.

In this post we will explain the TDS provisions in brief as follows:

There are 6 stages in TDS process

a) A payment becomes due

b) A payment is made which may be advance or may be against the payment due

c)TDS has to be deducted on the payment depending upon the threshold

d)Deposit the tax deducted with government

e) File the TDS return

f) Issue TDS deduction certificate

Check for the liability to deduct TDS  based upon following table:

There is separate section for each payment and there is threshold for every payment beyond which tds deduction is to be made.The details are as per following table:

Deposit of TDS:

Once TDS is made pay the tax in the government account vide challan 281 within 7 days of next month in which deduction is made.The deduction made in the month of march can be made by 30th April

File TDS/TCS return:

TDS return are to be filed quarterly for each quarter.Ideally there are three returns 26Q for all payments other than salary and 24Q for deductions from salary. 27Q for payments made to NRI/NRE In case of government deductor Salary TDS return is filed monthly in form 24G.In case of deduction of TDS on payment made in immoveable property the return is filed in 26QB along with payment of challan.An other form of TDS return is filed for amount collected om certain payments under TCS provisions

Issue TDS certificate :

After return is filed certificate of tax deduction is to be issued in form 16/16A/16B

Time limits for various process under TDS provisions:

  • Deposit of tax : within 7 days of next month in which amount is deducted.In case of March month can be deposited by 30th April
  • Filing of TDS return: By the last date of month following quarter.In case of fourth quarter 31st May after the last date of quarter.
  • Issue of TDS certificate: 15 days following the last date of filing of TDS return (this is academic point as now the TDS certificates are downloaded from the Traces site online and ideally the date of downloading must be by 15 days of the last date of filing of TDS return)

Payment without deduction of TDS :

There may be case where TDS need not be deducted as follows:

  • The payment is below threshold
  • The payee has certificate of no deduction
  • The provisions says so eg in case of senior citizens or where the person gives declaration that his income is below exemption limit in the form of 15G/15H

In these cases 15G/15H which are received during the quarter are filed online quarterly on or before 15th of the month following the quarter.

TAN (Tax Deduction Allotment Number):

Each Deductor has to have one TAN wherein the taxes are to be paid in this account and the returns are filed with this TAN.To apply for TAN it is to be made in form 49B

For any clarification please mail us at





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