TDS Return Form 27Q is filed for tax deducted on income other than salary paid to non-residents under the Income Tax Act. Unlike Form 26Q for residents, Form 27Q specifically caters to non-residents. It includes details of the deductee, such as PAN and the amount of TDS deducted. TDS rates are prescribed under various sections and do not follow slab rates. Surcharge and cess apply if the income exceeds threshold limits. Filing deadlines for Form 27Q are quarterly, with due dates being the last day of the month following the end of the quarter, except for Q4, where the due date is 31st May. The challan payment deadline is the 7th of the subsequent month, except for March, which is extended to 30th April. Delays in TDS deduction or payment attract interest at 1% or 1.5% per month, respectively, and such interest cannot be claimed as a tax-deductible expense. Additional forms, such as Form-16A and TBR, are issued depending on the availability of the deductee’s PAN. The article also emphasizes that interest liabilities arising from late payment or deduction are treated as permanent differences and are not eligible for deferred tax adjustments. For TDS on resident salary income, refer to Form 24Q, and for non-salary income of residents, refer to Form 26Q.
1. Applicability of 27Q:-
- TDs is deducted on income other than salary of non-resident under various sections of the Income Tax Act.
2. Resident or Non-resident individual:-
- If TDs is deducted of resident persons on other than salary then the deductor is required to file 26Q. (Link of the article: TDS Return Form 26Q: Due Dates & Other Applicable Forms ).
- If TDs is deducted of non-resident persons on other than salary then the deductor is required to file 27Q.
3. TDs return:-
- In case of TDs is deducted on income of non-resident persons other than salary, deductor is required to file the Form-27Q, which contains the details of deductee whose TDs has been deducted.
4. Deductor vs Deductee:-
| 1 | Deductor | The person who deducts the TDs |
| 2 | Deductee | The person whose TDs is deducted |
5. TDs rate:-
- TDs rates are prescribed under various sections. TDs will not be deducted on the basis of slab rate.
6. Surcharge & cess:-
- Surcharge shall be levied at the time of TDs deduction if income exceeds the threshold for applicability of surcharge.
- Cess shall also be levied at the time of TDs deduction.
7. TDs return due date:-
| Sr. No. | Period | Due date of filing of 27Q |
| 1 | April to June | 31st July |
| 2 | July to September | 31st October |
| 3 | October to December | 31st January |
| 4 | January to March | 31st May instead of 30th April |
- The return will be filed on quarterly basis.
- The due date is the last day of the month following the end of the each quarter except for the 4th
8. Challan due date:-
| Sr. No. | Period of deduction | Due date of payment |
| 1 | April | 7th May |
| 2 | May | 7th June |
| 3 | June | 7th July |
| 4 | July | 7th August |
| 5 | August | 7th September |
| 6 | September | 7th October |
| 7 | October | 7th November |
| 8 | November | 7th December |
| 9 | December | 7th January |
| 10 | January | 7th February |
| 11 | February | 7th March |
| 12 | March | 30th April instead of 7th April |
- Challan should be deposited on monthly basis.
- The due date is the 7th of the following month in which TDs was deducted except for the month of March.
9. Form-16A:-
- It is issued by deductor to deductee on quarterly
- Form-16A is issued only when TDs has been deducted on other than salary.
- It is issued if the deductee has a valid PAN.
10. TBR:-
- TBR is transaction based report issued by deductor.
- It is issued when the deductee does not have a valid PAN.
11. Interest on late deduction of TDs:-
- If TDs is not deducted on time then interest liability will arise @1% per month or part thereof.
- Period for interest calculation:
From the date on which TDs was deductible till actual date of deduction.
- Suppose, TDs of April month is deducted on 9th June, then interest will be levied from April to June.
- Interest will be calculated on TDs amount.
- For interest calculation, part of month is considered as full month.
| S. No. | Particulars | Amount |
| 1 | Professional fees for the month of April | 10,00,000 |
| 2 | TDs liability including surcharge & cess | 1,00,000 |
| 3 | Liability for deduction of TDs | In April month |
| 4 | Actually deducted | In June month |
| 5 | Interest rate | 1% |
| 6 | Liability of interest | 3,000 ** |
** Interest calculation 1,00,000 * 1% * 3 months = 3,000
- Interest on late payment of TDs:-
- If TDs is deducted but not deposited on time then interest liability will arise @1.5% per month or part thereof.
- Period for interest calculation:
From the date on which TDs was deducted till actual date of payment.
- Suppose, TDs of April month is deducted on 30th April, but deposited on 10th June then interest will be levied from April to June.
- Interest will be calculated on TDs amount.
- For interest calculation, part of month is considered as full month.
| S. No. | Particulars | Amount |
| 1 | Professional fees for the month of April | 10,00,000 |
| 2 | TDs liability including surcharge & cess | 1,00,000 |
| 3 | Liability for deduction of TDs | In April month |
| 4 | Actually deducted | In April month |
| 5 | Due date of payment | 7th May |
| 6 | Actual date of payment | 10th June |
| 7 | Interest rate | 1.5 % |
| 8 | Liability of interest | 4,500 ** |
** Interest calculation 1,00,000 * 1.5% * 3 months = 4,500
13. Allowance or disallowance of interest:-
Interest is disallowed under IT Act. Assessee cannot claim such interest as an expense.
14. Deferred tax on interest:-
It is a type of permanent difference. Hence, no deferred tax is created on interest.
15. Refer to the 26Q article for TDs deducted of resident on other than salary: TDS Return Form 26Q: Due Dates & Other Applicable Forms
16. Refer to the 24Q article for TDs deducted of resident & non-resident on salary: Salary TDS return 24Q & due date of return & challan
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