SERVICESTax Deducted at Source (TDS) & Tax Collected at Source (TCS)
TDS/TCS return is a statement submitted to the Income Tax Department quarterly. Every deductor/ collector should mandatorily file the TDS/TCS return on time.
The total income of an assessee for the previous year is taxable in the relevant assessment year. However, income-tax is recovered from the assessee in the previous year itself through:
- Tax deduction at source (TDS)
- Tax collection at source (TCS)
- Payment of advance tax
Persons responsible for deducting tax or collecting tax at source should apply to the Assessing Officer for the allotment of a “tax-deduction and collection-account number”. We at FinAccy will help you in obtaining TAN and filing your TDS/ TCS return on a periodical basis.
Differences between TDS and TCS
| TDS | TCS |
(1) | TDS is tax deduction at source | TCS is tax collection at source. |
(2) | Person responsible for paying is required to deduct tax at source at the prescribed rate. | Seller of certain goods or provider of services is responsible for collecting tax at source at the prescribed rate from the buyer. Person who grants licence or lease (in respect of any parking lot, toll plaza, mine or quarry) is responsible for collecting tax at source at the prescribed rate from the licensee or lessee, as the case may be. |
(3) | Generally, tax is required to be deducted at the time of credit to the account of the payee or at the time of payment, whichever is earlier. However, in case of payment of salary and payment in respect of life insurance policy, tax is required to be deducted at the time of payment. | Generally, tax is required to be collected at source at the time of debiting of the amount payable by the buyer of certain goods to the account of the buyer or at the time of receipt of such amount from the said buyer, whichever is earlier. However, in case of sale of motor vehicle of the value exceeding ` 10 lakhs, tax collection at source is required at the time of receipt of sale consideration. |
DUE DATE FOR PAYMENT OF TDS
It is the responsibility of the organization deducting the TDS, known as the deductor, to duly pay the applicable TDS to the government before the due date. Generally, the due date for TDS payment is always the 7th day of the next month, with a few exceptions.
Returns for TDS
There are different forms which cater to the different purposes of deduction of TDS depending on the nature of the transaction:
- Form 24Q for tax deducted at source for salaried people. It is a quarterly statement.
- Form 26Q for tax deducted at the source which covers all sorts of payments except salaries. It is a quarterly statement.
- Form 27Q for deduction of tax from dividends, interest or any other sum payable to non-residents.It is a quarterly statement.
- Form 26QB is a statement cum challan of deduction of tax under Section 194-1A.
- Form 26 QC is a statement cum challan of deduction of tax under Section 194-1B.
- Form 27 EQ is the collection of tax at source (TCS). It is a quarterly statement.
TDS Return Due Date:
Once the deductor has deposited the TDS, they also have to file the TDS return. The TDS return is a detailed account of TDS paid to the government and the challan information at the end of every quarter. The due dates for the mandatory TDS filing are as follows:
Sl. No. | Date of ending of the quarter of the financial year | Due date |
1. | 30th June | 31st July of the financial year |
2. | 30th September | 31st October of the financial year |
3. | 31st December | 31st January of the financial year |
4. | 31st March | 31st May of the financial year immediately following the financial year in which the deduction is made. |
TCS Return Due Date:
Sl. No. | Date of ending of the quarter of the financial year | Due date |
1. | 30th June | 15th July of the financial year |
2. | 30th September | 15th October of the financial year |
3. | 31st December | 15th January of the financial year |
4. | 31st March | 15th May of the financial year immediately following the financial year in which the deduction is made. |
TDS LATE FILLING FEE
If you delay the payment of TDS that exceeds the TDS due date, then under Section 234E, you will have to pay charges of ₹200 per day until the charge fee is equal to the return filing amount that is TDS.