Since a major part of the income tax revenue is collected through deduction of tax at source, errors committed at this point in time prove costly to the exchequer. Currently withheld tax is deposited monthly and TDS statements are furnished quarterly. Further there is no mechanism as on date to have a check on the correct deduction of tax and its payment. A lot of work related to TDS compliances in majority of the non organized sector is handled by either graduates or non professionals who may not be well versed with the applicable TDS provisions. The income tax department is having limited resources to check and cross verify all the TDS statements furnished quarterly. It is the need of the hour that the TDS statements filed quarterly are certified by a professional to enhance its accuracy and thereby minimizing the loss in revenue to the government.
In view of the aforesaid, it is suggested that a provision may be made whereby all transactions pertaining to TDS provisions are audited by a professional once every quarter before filing of TDS statement which will lead to early detection of errors and maximizing the revenue to the government.