TDS Return Filing Online - Types, Eligibility, Forms, Due Dates, Process, Penalty

TDS Return is a quarterly statement that needs to be submitted by the deductor to the Income Tax Department. The statement shows a summary of all the entries for TDS collected by the deductor and the TDS paid to the Income Tax Authority. The tax is required to be deducted at the time money is credited to the payee’s account or at the time of payment, whichever is earlier.

Usually, the person receiving income is liable to pay income tax. But the government with the help of Tax Deducted at Source provisions makes sure that income tax is deducted in advance from the payments being made. The recipient of income receives the net amount (after reducing TDS). The recipient will add the gross amount to his income and the amount of TDS is adjusted against his final tax liability. The recipient takes credit for the amount already deducted and paid on his behalf.

Details Required to file TDS Returns

1. PAN of the deductor and the deductee
2. Amount of tax paid to the government
3. TDS challan information
4. Date of Payment or Credit of Transaction
5. Amount on which TDS is deducted
6. Rate at which TDS is deducted

What is a TDS Certificate?

TDS certificates have to be issued by the payer deducting TDS to the payee from whose income TDS was deducted while making payment. Form 16, Form 16A, Form 16B, and Form 16C are all TDS certificates.

There are mainly 4 types of TDS Return Forms:

1. Form 24Q: The quarterly statement for tax deducted at source from “Salaries”
2. Form 26Q: Quarterly statement of tax deducted at source on all payments other than “Salaries”
3. Form 27Q: Quarterly statement of deduction of tax from interest, dividend, or any other sum payable to non-residents
4. Form 27EQ: Quarterly statement of collection of tax at source

1. TDS Return on Salary Payment (Form 24Q)

Form 24Q is a quarterly statement of deduction of tax on salary under Section 192 of the Income Tax Act, 1961. An employer deducts TDS at the time of paying salary to an employee. TDS Form 24Q is to be filled by the employer for TDS deduction and submitted to the Income Tax Department quarterly.

Details of the salary paid, TDS deducted from it and challan details are reported in Form 24Q. All the companies and firms in India are required to make this declaration and payment every quarter.

Form 24Q contains 2 annexures, namely Annexure-I and Annexure-II. Annexure-I contains details of the deductor, deductees, and challans, while Annexure-II contains the salary details of the deductees.

1. Annexure-I is to be submitted by the deductor for all four quarters of the financial year.
2. Annexure-II is not required to be submitted in the first three quarters of the financial year but has to be furnished and submitted in the fourth quarter of the financial year with details of the employees’ salaries for the entire financial year.

2. TDS Return on Payments other than Salary (Form 26Q)

Form 26Q is a quarterly statement of deduction of tax on all the payments other than salary. The payer has to file a TDS return in Form 26Q quarterly and is applicable for tax deducted at source under section 200(3), 193, and 194 of the Income Tax Act of 1961.

Form 26Q contains only one annexure, unlike Form 24Q which has two annexures. Details of the deductor, deductees, and challan are to be mentioned in Form 26Q. The income on which the tax is deducted at source includes interest on securities, dividend securities, professional fees, directors’ remuneration, etc.

Note: It is compulsory to furnish PAN by the deductors who are non-government deductors. For government deductors “PANNOTREQD” has to be mentioned on the form.

3. TDS Return on Payments to Non-Residents (Form 27Q)

Form 27Q is a quarterly statement of deduction of tax on all the non-salary payments to an NRI. It comprises the details in regards to the payments made to a non-resident in that quarter by the payer. The Indian buyer is required to submit the form 27Q every quarter before the due date and is applicable for tax deducted at source under section 200(3) of the Income Tax Act of 1961.

The income on which the tax is deducted at source includes interest, bonus, any additional income, or any other sum owed to non-resident Indian or foreigner.

Note: Non-government deductors must furnish PAN. For government deductors, the code “PANNOTREQD” has to be mentioned on the form.

4. TDS Return on Collection of Tax at Source (Form 27EQ)

Form 27EQ is a quarterly statement that comprises the details and information of the tax collected at source as per section 206C of the Income Tax Act of 1961. Form 27EQ is required to be submitted quarterly and it is mandatory to mention the TAN details of the individual.

Form 27EQ shows the Tax Collected at Source, which is the tax collected by the seller. When a buyer purchases certain goods or commodities, the seller collects the tax from the buyer through the TCS route. This tax is collected on the payment received from the buyer either in cash, credit, cheque, demand draft, or from any other mode of payment.

Note: It is compulsory to furnish PAN by the deductors who are non-government deductors. For government deductors, the code “PANNOTREQD” has to be mentioned on the form.

TDS is payable on the earnings so it is important to note that the liability to pay TDS is applicable only in the event of earnings taking place. TDS is deducted before making payments. Deductions are to be made on payments that are made in cash, cheque, or credit. The amount deducted under TDS is further deposited with various government agencies.

Payment of TDS has various advantages which are as follows :

1. Deducting TDS at source prevents tax evasion
2. Tax collection is done duly and on time
3. A large number of people come under the tax net
4. The collection of TDS is a steady source of revenue for the government

Deductors must submit a TDS correction statement if the original return filed is found to be incomplete or inaccurate. The mistake could be incorrect TAN, challan details, or PAN of the deductee. Deductors are required to submit one statement in a single form for a particular TAN every quarter.