The Central Board of Direct Taxes (CBDT) had recently notified Rules 30, 31, 31A, 31AA, 37A, 37CA and 37D (Rules) pertaining to tax deducted/collected at source (TDS/TCS) in February 2010. The above notification validated the procedural compliances made during financial year (FY) 2009-10 for the period when the implementation of a new proposed TDS/TCS compliance procedure was kept in abeyance.

The CBDT has now, vide Notification No. 41/2010 dated 31 May 2010 (new Notification), notified Income-tax (Sixth Amendment) Rules, 2010 which amends the Rules. The new Notification is effective from 1 April 2010 and applies to tax deducted/collected on or after 1 April 2010. The procedural compliance for tax deducted/collected up to 31 March 2010 will be governed by the earlier Rules.

The notable features of the amended Rules are: (a) Time limit for deposit of TDS for the entire month of March will be 30 April instead of two separate time limits viz. 7 April for TDS up to 30 March and 31 May for TDS as of 31 March. (b) Non-salary TDS certificates will need to be issued on quarterly basis (instead of monthly or annual basis). (c) Time limit for filing quarterly TDS statement for last quarter of FY is advanced to 15 May instead of 15 June.

Summary of the new Notification

The new Notification amends the Rules relating to time and mode of depositing TDS, issuance of TDS/TCS certificate, filing of TDS/TCS quarterly statements etc.

The procedural requirements effective for tax deducted/collected on or after 1 April 2010 in terms of the new Notification are summarized below:

A. Time limit for depositing TDS/TCS

Particulars Earlier provision

 

 

New provision
By Government deductor Same day Same day if tax paid without challan i.e., by internal transfer Within 7 days from end of month  deduction if tax paid with challan
By Others TDS on credit made on date up to which accounts of deductor are made (except salary, lotteries, horse races etc.) Within two months TDS on credit made in month of March On or before 30 April
Other cases Within one week from end of month of tax deduction Other cases Within one week from end of month of tax deduction
With approval from the Tax Authority in special cases
TDS from interest (other than securities), insurance commission and commission/ brokerage Quarterly basis on 15 July, 15 October, 15 January and 15 April Quarterly basis on 7 July, 7 October, 7 January and 30 April
TDS from salaries Quarterly basis on 15 June, 15 September, 15
December and 15 March
Same as above
TCS

  • By Government deductor
  • By others
  • Within one week from end of month of tax collection at source
  • Same as above
  • Same day where tax paid without challan/within 7 days from end of month of tax collection where tax paid with challan
  • Within one week from end of month of tax collection

B. Prescribed income tax challan and mode of payment of TDS/TCS

Particulars Earlier provision New Provision
Form of challan Challan No. ITNS 281 Challan No. ITNS 281
Mode of payment of TDS/TCS Without challan i.e., internal transfer by Government deductors Form 24G within 10 days from end of month of tax deduction/collection by Government deductors paying without challan
Mandatorily by electronic mode for (a) Companies (b) Other deductors/collectors who are liable for tax audit* Mandatorily by electronic mode for (a) Companies (b) Other deductors/collectors who are liable for tax audit
For others – at their option either physically or by electronic mode For others- at their option either physically or by electronic mode

* In terms of Rule 125

C. Form for issue of TDS/TCS certificate

Particulars Earlier provision New Provision
Form for TDS certificate
  • Form 16 for salary TDS
  • Form 16A for others
  • Form 16AA for salary TDS where salary income is less than INR 1.50 lak
  • Form 16 for salary TDS
  • Form 16A for others
Form for TCS certificate Form 27D Form 27D

Note: In addition to other requirements, the new forms require disclosure of the address of TDS Tax Authority.

D. Time limit for issue of TDS/TCS certificate

Particulars Earlier provision New Provision
TDS TDS from salary and insurance commission Within one month from the close of FY (CBDT Circular No. 2 of 2007 dated 21 May 2007 provided option to issue such certificates with digital signature) TDS from salary On annual basis by 31 May following the FY of tax deduction (can be optionally issued with digital signature)
Where credit is made
on date up to which accounts of deductor are made credit
‘ Within one week from expiry of two months from date of credit Others On quarterly basis within 15 days from due date of furnishing TDS quarterly statement
Others Within one month from end of month of credit/ payment
Where quarterly deposit of TDS is allowed Within 14 days of
payment of TDS
Consolidated TDS
certificate for multiple payments at request of deductee
Within one month from close of FY
TCS Within one month from end of month of debit/receipt On quarterly basis within 15 days from due date of TCS quarterly statement

E. Form and time limit for quarterly statements of TDS/TCS

Particulars Earlier provision New provision
Form for furnishing quarterly statements of TDS/TCS Salary TDS Form 24Q Salary TDS Form 24Q
Other TDS (resident deductees) Form 26Q Other TDS (resident deductees) Form 26Q
Other TDS (non- resident/not ordinarily resident deductees) Form 27Q Other TDS (non- resident/not ordinarily resident deductees) Form 27Q
TCS Form 27EQ TCS Form 27EQ
Time limit for furnishing quarterly statements of TDS/TCS

  • TDS
  • TCS
.

.

  • 15 July, 15 October, 15 January and 15 June
  • 15 July, 15 October, 15 January and 30 April
.

.

  • 15 July, 15 October, 15 January and 15 May
  • Same as above

Comments

The new Notification amends the procedural compliances and applies to tax deducted/collected on or after 1 April 2010.

The time limit for deposit of TDS for the entire month of March is rationalized to 30 April instead of two separate time limits viz. 7 April for TDS up to 30 March and 31 May for TDS as of 31 March.

The time limit for issue of TDS certificates for non-salary TDS is rationalized to quarterly basis instead of monthly basis. However, deductors will need to note that the facility of issuing annual consolidated certificate for such TDS, at the request of deductee, has been withdrawn.

Deductors will also need to note that the time limit for filing quarterly TDS statements for last quarter of FY has been advanced to 15 May instead of 15 June.

Related Post:-

  1. Download Latest Form 16, 16A, 27D, 24G in Excel Format for A.Y. 2011-12
  2. Income-tax (Sixth Amendment) Rules, 2010 – Substitution of rules 30, 31, 31A, 31AA, 37CA and 37D; Form Nos. 16, 16A and 27D; insertion of Form No. 24G and omission of rule 37A
  3. New Changes in TDS Rules related to due date for furnishing TDS return/Certificate, inclusion of receipt number in TDS certificate and Requirement of filing form No. 24G by government companies
  4. Summary of Recent Amendments in TDS rules vide Notification No. 41/2010 Applicable from 01.04.2010

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0 responses to “Summary/Analysis of recent CBDT amendment of rules relating to TDS/TCS Applicable from 01.04.2010”

  1. sanjay a. bhore says:

    this is the grate side to learn student of tax thankful tax guru

  2. zinobia Movdawala says:

    Quaterly compliance of TDS cErtificate Issue is was not required, It would unnecessarilily create tedious paperwork process.Furthur Quaterly TDS payment should be more clearly clarified as to which entities would be eligable to apply to there Assessing Officers must be some criteria?

  3. Ashok Kumar says:

    Very good summary plz do forward me the latest issues related to tax. I wud really b grateful to u

  4. Indian income tax says:

    I agree with the above post,
    as Central Board of Direct Taxes (CBDT) had recently notified Rules for TDS,you can find more information about TDS and its rules at Indian income tax.

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