CPC-TDS Communication to Banks Regarding Non reporting of 15G/H transaction in contravention of rule 31A (4) of Income Tax Rules read with section 200 of Income Tax Act

1) In this regard, it is to inform you that ________ branches out of ________ active branches of your bank have not reported transaction of payment of interest on which tax was not deducted in view of declaration of 15G or 15H form by the payee. We are also sending a separate communication to the non-compliant branches, attached in the list.

2) __________ branches have in all reported __________ transactions involving declaration of 15G or 15H. The amount involved in such transactions is to the tune of Rs. _______ Crore for F.Y. 2013-14. Form 15G/15H can be submitted by the payee only if the income including the interest income is less than the taxable amount.

3) You are requested to reconcile the amount of Rs. ______ Crore reported by your bank branches with the interest amount paid to payees who declared 15G or 15H as per core banking solution of your bank. In case of discrepancy, it is requested that the relevant branches may be instructed on top priority to comply to the provisions of Income tax act in respect of complete & correct reporting of transactions involving 15G or 15H declaration.

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Since the due date of filing Q2 2014 TDS Statements (October 15) is approaching fast, you are requested to ensure the details of 15G/H transactions from your source data and raise Flag “B” in the Original TDS Statements. Also, please ensure submission of Correction Statements for previous Quarterly TDS Statements of the branches.

CPC (TDS) reminder to Banks for raising Flag “B” in TDS Quarterly Statements against 15G/H transactions

As you may be aware that the depositors submit form 15G/H to the bank for no deduction of tax to be made on the interest payments made to them. As per rule 31A (4) of Income Tax Rules read with section 200 of Income Tax Act, the referenced 15G/H transactions are required to be reported by raising Flag “B” in relevant TDS Statements (Form 26Q).

However, CPC(TDS) has observed from its records that you have not raised Flag ‘B’ for �No deduction on account of 15G/H� even against a single transaction as reported in the TDS Statement(s) submitted for various quarters of Financial Year 2013-14.

It is highly improbable that not even a single depositor has submitted form 15G/H to you for non-deduction of tax on the interest payments. Accordingly, you are advised to take the following action:Actions to be taken:

–  Since the due date of filing Q2 2014 TDS Statements (October 15) is approaching fast, you are requested to check the details of 15G/H transactions from your source data and raise Flag “B” in the Original TDS Statements.

– Please submit Correction Statements for previous Quarterly TDS Statements by taking following actions:

  • Download the Conso File from our portal.
  • Prepare the correction statement with appropriate changes.
  • Please ensure that the TDS Deposited amount equals the TDS Deducted amount in your correction statement. Submit the Correction Statement at TIN Facilitation Centre.

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6 responses to “Report 15G/ 15H transaction & raise Flag B in Quarterly TDS Returns”

  1. Sangeeta Singhvi says:

    If I have filled Form 15G online for the Qtr under consideration and TDS Return for the same Qtr is filled without raising Flag ‘B’ , now what can I do to Resolve the same.

  2. akash vajpai says:

    For tax related any query you can mail me @ akashvajpai24@gmail.com. Answer will be given in 24 hours

  3. catarannum says:

    I have bank client for which I am filling TDS return. So should I show each transaction for which tax is not deducted due to form 15g/15h submission?

  4. nagesh kini says:

    As a matter of caution the banks should advise their clients with taxable income not to file the forms and better still not accept the forms at all by telling clients that it is an offence.

  5. Dinesh B. Vaidya says:

    This was required as most of the bank branches take submission of Form 15G/H lightly and not sincere for reporting these figures. Due to this many assessees had not declared their interest income for tax. If reporting of such interest is implemented by bank branches, govt. can find tax evaders and can take necessary penal action against them.

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