Everything about TDS Return Filing

Introduction

Tax Deduction at Source or TDS refers to deducting tax from the income at the point of payment to other party. Individuals or organisations which deduct the tax at source, are required to file TDS returns on quarterly basis.

TDS or Tax Deducted at Source is a method where income tax is deducted automatically from payments made to a person during specified transactions, which I specified in detail in my TDS article for current financial year at taxguru, Link: TDS Rate Chart (FY 2024-25; AY 2025-26)

TDS is deducted on income such as salary, rent, interest, fees, and commissions. Typically, when receiver of payment is required to pay the income tax. However, the TDS makes the tax liable to be collected upfront from the payments been made, ensuring timely tax collection by the government.

The amount received after the TDS deduction is known as net income of the recipient, and they are required to report amount before the TDS deduction in their ITR.

What is TDS return filing?

TDS (Tax Deducted at Source) return serves as a comprehensive record summarizing all transactions involving tax deductions at the source within a particular quarter and a specific form. This practice is pivotal for ensuring compliance with tax regulations and mitigating the risk of penalties. Essentially, TDS return filing acts as a mechanism for the systematic reporting of taxes deducted at the source, typically by an employer or any entity making payments subject to TDS provisions.

Filing TDS returns on a quarterly basis is not just a formality but a legal obligation mandated by tax laws. It involves the meticulous documentation of various details, including the Permanent Account Numbers (PANs) of both the deductor (the entity deducting tax) and the payee (the recipient of the payment subject to TDS). Moreover, the TDS return must encapsulate specifics of TDS payments made, such as the amount deducted and the nature of the transaction, along with the details of the challans deposited to the government treasury.

The significance of filing TDS returns transcends mere compliance; it directly impacts the tax liabilities and obligations of both the deductor and the payee. For the payee, the details furnished in the TDS return reflect in their Form 26AS, a crucial document that summarizes their tax-related transactions. Hence, accurate and timely filing of TDS returns not only ensures adherence to tax regulations but also facilitates transparency and accountability in tax administration. Consequently, individuals falling within the specified income tax brackets are mandated to file TDS returns to uphold the integrity of the tax system and fulfill their fiscal responsibilities.

Who is Required to File a TDS Return?

Employers and organizations have an obligation to file TDS returns which possess a valid Tax Deduction and Collection Account Number or TAN. It also applies to individuals subject to audit under Section 44AB and those working in government or any of the corporate positions. They are obligated to file quarterly returns.

TDS rates differ based on the type of income, as I specified in my TDS article(Link provided above). Hence the applicable rate of tax deduction depends on nature of income as well as Level of income. Depending on income which is taxable, rates may range from 1% to 30%, may even include surcharge in case of section 195 in case of non residents.

What is the Due Date of filing TDS returns?

The due date for filing the TDS Return falls every quarter, which oblige every individual or organisation to deduct TDS and must follow the below mentioned timelines. These returns are essential for reporting the details like TAN, amount deducted along with section, type of payment, and PAN of the individual from whose payment the tax was deducted.

It totally depends on the nature of income on which TDS is deducted, different forms are prescribed for the submission of TDS returns.

What are actual deadline to file TDS Return?

Let’s understand by the below table for easy understanding:

Period or Quarter	TDS Return Due Date
April to June	31st July
July to September	31st October
October to December	31st January
January to March	31st May

To fulfil the obligations of payment of TDS properly to avoid unnecessary penalties and interest, it’s important to follow above deadlines and ensure filing TDS on timely basis.

Which are the forms relating to TDS Returns? 

It totally depends on the income along with type of the person whose TDS is deducted. Let me summarise these forms by a table to that you can get easy understanding:

Form	Particulars
Form 24Q	The quarterly statement for TDS specifically from “Salaries“
Form 26Q	Quarterly statement of TDS in respect of all payments other than “Salaries”
Form 27Q	Quarterly statement of TDS in respect of interest, dividend, or any other sum or payments to non-residents
Form 27EQ	A Quarterly statement of Tax collection at source (TCS)

What are the essential documents and details for submission of TDS return online?

Documents which are required for filing of TDS returns online, are the Tax Deduction and Collection Account Number or TAN which identifies the entity which is responsible to deduction the tax, next is the PAN Details, for reference purpose, previous TDS Filing Records is also required because if previously returns are filed by company

What is the penalty for failure in filing the TDS returns?

As I discussed this earlier, If the assessee fails to file return before the due date which I mentioned in the table above, then there is a penalty of Rs.200 per day as per the Section 234E of Income tax Act.

Default in filing TDS return within twelve months from the due date or making wrong entries in returns may attract punitive measures inclusive of penalties. In this case, the taxpayer is also known as assessee who shall be liable for fines as provided under the Income Tax Act.
According to Section 234E of the Income Tax Act, a late or incorrectly filed TDS attracts penalty between Rs. 10,000 and Rs. 1,00,000.

This penalty is charged over and above any other charges or fines required by law. In substance, the fine discourages delayed and inaccurate submission of TDS returns hence one must be conversant with taxation rules.

By implementing penalties for non-adherence to or distortions in TDS return filing, tax authorities seek to maintain tax system’s credibility and promote tax administration accountability. Therefore, taxpayers must exercise caution while submitting their TDS returns so that they do not violate any regulation that may warrant imposition of penalties on them.

How to get to know that return is filed?

After successful submission of return, you will receive an acknowledgement from the Income tax Department, which will be kept by you for your records.

Can we Revise TDS Returns?

If errors are found in submitted TDS returns, such as inaccurate challan information or missing or incorrect PAN details, the credited tax amount won’t show up in Form 16A/Form 26AS. To correct this, a revised TDS return must be filed.

What are the prerequisites for submission of revised TDS returns?

For individuals looking to amend their TDS (Tax Deducted at Source) returns it’s important to grasp the steps and requirements involved. Initially revising TDS returns is only allowed after the original submission has been approved by the TIN (Tax Information Network) system. This approval indicates that the initial filing has been recognized and processed by tax authorities. To check the status of their returns taxpayers can easily visit the TIN Central System on either the Income Tax website or Another way of ascertaining the status of the e-filed TDS returns is through platforms such as NSDL.

This can be done by keying in details like their PAN (Permanent Account Number) card and either Provisional Receipt Number or Token Number. By this, taxpayers can trace their TDS registration progress. In addition, it allows for information update in case some changes are required.

Lastly, when preparing revised TDS returns it’s important to consult what is referred to as consolidated TDS statement. The statement gives highlights on all deductions made on TDS during the period and can be obtained from TRACES website.

Therefore, using consolidated statement helps assure that revised TDS returns will be corresponding with updated tax information hence making them credible enough and compliant.

By following these procedural guidelines and utilizing online tools, one may smoothly complete the process of amending Tax Deducted at Source filing thereby ensuring compliance with regulations while avoiding potential disputes.

What is the process of claiming TDS credit?

Deductors can claim TDS credit, but the deductee must specify TDS details when filing their ITR. It’s crucial for the deductee to accurately mention the TDS certificate number and details. Incorrect details can lead to discrepancies in tax credit processing when filing TDS returns. Currently, the Income Tax portal typically auto-populates these details.

This article is written on 16^th May 2024 and all the information given in this article is as on above date