Article explains What is TDS, Who are required to file TDS Return, Due dates of payment and Filing of Forms, Consequence of non-filing of TDS Returns, Interest on late deposit of TDS and TDS rates for F.Y.2022-23.
1. (TDS) Tax Deducted at Source is a specific amount that is deducted when a certain payment like salary, commission, rent, interest, professional fees, etc. is made.
2. WHO ARE REQUIRED TO FILE TDS RETURN?
Assessee liable to deduct TDS under Income Tax Act, 1961 are responsible for filing return of income . The person who deducts TDS is called deductor and person whose TDS is deducted is called deductee. Deductor is responsible to file TDS returns with Government.
The glimpse of mostly used sections under which TDS is required to be deducted, threshold limit and rate of TDS is as follows-
DUE DATES OF PAYMENT AND FILING OF FORMS :
| QUARTER ENDING | MONTH OF DEDUCTION | DUE DATES OF PAYMENT | DUE DATES FOR FILING OF TDS RETURN |
| 30th June, 2022
|
April 2022 | 7th May,2022 |
31st July,2022 |
| May 2022 | 7th June,2022 | ||
| June 2022 | 7th July, 2022 | ||
| 30th September,2022 | July,2022 | 7th Aug,2022 |
31st Oct,2022 |
| Aug,2022 | 7th Sep,2022 | ||
| Sep,2022 | 7th Oct,2022 | ||
| 31st Dec,2022 | October,2022 | 7th Nov,2022 |
31st Jan,2023 |
| November,2022 | 7th Dec,2022 | ||
| December,2022 | 7th Jan,2023 | ||
| 31st March,2023 | Jan,2023 | 7th Feb,2023 |
31st May,2023 |
| Feb,2023 | 7th Mar,2023 | ||
| Mar,2023 | 7th April,2023
(GOVT EMPLOYEE) 30TH April,2023 (Others) |
4. CONSEQUENCE OF NON-FILING OF TDS RETURN
Penalty of Rs. 200 each day till the return is filed. However Total Liability should not be greater than the TDS Amount.
The Assessing Officer may direct a person who fails to file the statement of TDS/TCS within the due date to pay a minimum penalty of Rs 10,000 which may be extended to Rs 1 Lakh.
5. INTEREST ON LATE DEPOSIT OF TDS:
| SECTION | NATURE OF DEFAULT | INTEREST SUBJECT TO TDS/TCS AMOUNT | PERIOD FOR WHICH INTEREST IS TO BE PAID |
| 201(1A) | TDS Not Deducted | 1% per Month | From the date on which tax is deductible to the date on which tax is actually deducted. |
| 201(1A) | TDS not deposited to the government after deduction (fully or partly) | 1.5% Per Month |
From the date of tax deduction to the date of deposit |
6. TDS RATES FOR F.Y. 22-23
| Nature of Payment Made To Residents
|
Threshold (Rs.) |
Company / Firm /Co-operative Society /Local Authority |
Individual / HUF |
If No / Invalid PAN |
||
| Section – Description |
IT Rate (%) |
IT Rate (%) | IT Rate (%) | |||
| 192A – Payment of accumulated balance due to an employee.(applicable from 01.06.2015) | 50,000 | – | 10 | 30 | ||
| 193 – Interest on securities | 10,000 | 10 | 10 | 20 | ||
| 194 – Dividends | 5,000 | 10 | 10 | 20 | ||
| 194A – Interest other than interest on securities – in any Others Case | 5,000 | 10 | 10 | 20 | ||
| 194A – Senior citizen | 50,000 | – | 10 | 20 | ||
| 194B – Winning from Lotteries | 10,000 | 30 | 30 | 30 | ||
| 194B proviso – Winnings from lotteries and crossword puzzles where consideration is made in kind or cash is not sufficient to meet the tax liability and tax has been paid before such winnings are released (Applicable From 01-July-2022) | 10,000 | 30 | 30 | 30 | ||
| 194BB – Winnings from Horse Race | 10,000 | 30 | 30 | 30 | ||
| 194C – Payment to Contractors | 1,00,000 | 2 | 1 | 20 | ||
| 194IC– Payment under Specified agreement | – | 10 | 10 | 20 | ||
| 194D – Insurance Commission | 15,000 | 10 | 5 | 20 | ||
| 194DA – Payment in respect of life insurance policy (applicable from 01.10.2014) | 1,00,000 | 5 | 5 | 20 | ||
| 194E – Payment to Non-Resident Sportsmen or Sports Association | – | 20 | 20 | 20 | ||
| 194EE – Payments out of deposits under NSS | 2,500 | 10 | 10 | 20 | ||
| 194F – Repurchase Units by MFs | – | 20 | 20 | 20 | ||
| 194G – Commission – Lottery | 15,000 | 5 | 5 | 20 | ||
| 194H – Commission / Brokerage | 15,000 | 5 | 5 | 20 | ||
| 194I – Rent | 2,40,000 | 10 | 10 | 20 | ||
| 194I(b)-Land and Building/Furniture/Fittings | ||||||
| 194I(a) – Plant/Machinery/Equipment | 2,40,000 | 2 | 2 | 20 | ||
| 194IA – Transfer of certain immovable property other than agriculture land (w.e.f. 1-6-2013) | 50,00,000 | 1 | 1 | 20 | ||
| 194J – Fees for Professiona/Technical Services | 30,000 | 10 – Others
2 – Fees for Technical Services (not being professional services), royalty for sale, distribution or exhibition of cinematographic films and call centre |
10 – Others
2 – Fees for Technical Services (not being professional services), royalty for sale, distribution or exhibition of cinematographic films and call centre |
20 |
||
| 194K – Payment of Dividend by Mutual Funds (Applicable From 01-Apr-2020) | 5,000 | 10 | 10 | 20 | ||
| 194LA – Immovable Property | 2,50,000 | 10 | 10 | 20 | ||
| 194LB – Income by way of interest from infrastructure debt fund (non-resident) | – | 5 | 5 | 20 | ||
| 194LBA – Certain income from units of a business trust to Residents | ||||||
| 194LBA (a) – Certain Income in the form of interest from units of a business trust to a residential unit holder | – | 10 | 10 | 20 | ||
|
194LBA (b) – Certain Income in the form of dividend from units of a business trust to a resident unit holder |
– | 10 | 10 | 20 | ||
|
194LBA – Certain income from units of a business trust to Non Resident :- |
||||||
|
194LBA(1) – Payment of the nature referred to in Section 10(23FC)(a) |
– | 5 | 5 | 20 | ||
|
194LBA (2) – Payment of the nature referred to in Section 10(23FC)(b) |
– | 10 | 10 | 20 | ||
|
194LBA (3) – Payment of the nature referred to in section 10(23FCA) by business trust to unit holders |
–
|
40% – For Non Residents Company 30% – For Non Residents other than companies
|
30 | 30/40 | ||
| 194LBB – Income in respect of units of investment fund. |
10% – For Residents 40% – For Non Residents Company 30% – For Non Residents other than companies
|
25% – For Residents 30% – For Non Resident |
25/30/40
|
|||
| Sec 194LBC – Income in respect of investment in securitisation trust. | 10% – For Residents
40% – For Non Residents Company 30% – For Non Residents other than companies |
25% – For Residents
30% – For Non Resident |
25/30/40
|
|||
| Sec 194LC – Income by way of interest by an Indian specified company to a non-resident / foreign company on foreign currency approved loan /long-term infrastructure bonds from outside India (applicable from July 1, 2012) |
5 or 4*
* In case where interest is payable in respect of Long-term Bond or Rupee Denominated Bond listed on recognised stock exchange located in IFSC
|
5 or 4*
* In case where interest is payable in respect of Long-term Bond or Rupee Denominated Bond listed on recognised stock exchange located in IFSC |
20 |
|||
|
194LD – Interest on certain bonds and govt. Securities(from 01-06-2013) |
– |
5 |
5 |
20 |
||
|
194N – Payment of certain amounts in cash. |
Withdrawal in Excess of Rs. 1 Cr. |
2 | 2 | 20 | ||
|
194NF – Payment of certain amounts in cash to non-filers
|
1. Withdrawl Exceed 20 Lacs but does not exceed 1 Cr.
2. Withdrawl Excess 1 Cr.
|
2% – Exceed 20 Lacs but does not exceed 1 cr.
5%-Withdrawl in Excess of Rs. 1 cr. |
2% – Exceed 20 Lacs but does not exceed 1 cr.
5%-Withdrawl in Excess of Rs. 1 cr. |
20
|
||
| 194O – TDS on e-commerce participants (Applicable From 01-Oct-2020) | 500000 (Individual /HUF) | 1 | 1 | 5 | ||
| 194P – TDS in case of Specified Senior Citizen | – | Not Applicable | Rates in Force | |||
| 194Q – TDS on Purchase of Goods exceeding Rs. 50 Lakhs (Applicable From 01-July-2021) | In Excess of Rs. 50 Lakhs | 0.1 | 0.1 | 5 | ||
| 194R – TDS in case any benefit or perquisite (arising from business or the exercise of a profession) is provided (Applicable From 01-July-2022) | 20000 | 10 | 10 | 20 | ||
| First Proviso to sub-section (1) of section 194R– TDS in case any Benefits or perquisites of business or profession where such benefit is provided in kind or where part in cash is not sufficient to meet tax liability and tax required to be deducted is paid before such benefit is released( Applicable From 01-July-2022) | 20000 | 10 | 10 | 20 | ||
| 194S– TDS on payment on transfer of Virtual Digital Asset ( Applicable From 01-July-2022) | 10000 | 1 | 1 | 20 | ||
| Proviso to sub-section(1) of section 194S– TDS on Payment for transfer of virtual digital asset where payment is in kind or in exchange of another virtual digital asset and tax required to be deducted is paid before such payment is released ( Applicable From 01-July-2022) | 10000 | 1 | 1 | 20 | ||
| 194O – TDS on e-commerce participants (Applicable From 01-Oct-2020) | 500000 (Individual /HUF) | 1 | 1 | 5 | ||
| 194P – TDS in case of Specified Senior Citizen | – | Not Applicable | Rates in Force | |||
| Sec 195 – Other Sums | – | Average rates as applicable | – | 20/30/40 | ||
| Sec 196A – Foreign comp unit holder of MF |
* 20
* Not Applicable for company
|
20
|
20
|
|||
| Sec 196B – Income from units | – | 10 | 10 | 20 | ||
| Sec 196C – Income from foreign currency bonds or GDR (including long-term capital gains on transfer of such bonds) (not being dividend) | – | 10 | 10 | 20 | ||
| Sec 196D – Income of Foreign Institutional Investors/ Specified Fund :- | ||||||
| Sec 196D – Income of foreign institutional investors from securities under sub-section (1) | – | 20 | 20 | 20 | ||
| Sec 196DA – Income of specified fund from securities referred to in clause (a) of sub-section (1) of section 115AD (other than interest income referred to in section 194LD) | – | 10 | 10 | 20 | ||
7. OUR COMMENTS-
The provisions of TDS are expanding to increase tax base and bring into radar high earning and spending individuals who are not paying taxes. The TDS provisions are introduced for dual purpose, firstly, to put an eye on transactions and secondly is to collect revenue from the very source it gets originated. The income tax department also sends notices if amount of income and TDS deducted thereon reflecting in Form 26AS does not matches with income declared in return. It is therefore necessary to reconcile the same while filing return of income. At Financial Tree Company we take care of these very steps while filing return of income to avoid notices from department.
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The above comments do not constitute professional advice. The Author can be reached at companyfinancialtree@gmail.com or call us on 9111872247 or visit website www.financialtreecompany.com. My name is Priyanka Agrawal and I am Tax Consultant at FINANCIAL TREE COMPANY (An online return filing and Tax Consultancy Company). I have years of experience in field of Income Tax and Finance.We also upload educational videos in You tube and name of our channel is FINANCIAL TREE COMPANY. Our aim is to help people in improving their financial health by spreading knowledge and love. Stay Financially Fit and Healthy.
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How the author can be FINANCIAL TREE COMPANY and also a CA in Practice? If CA in Practice, then open invitation (Advertisement) to viewers for providing tax solutions is against ‘Code of Ethics’.