TCS Return u/s. 206C last date 15th Oct.

TCS Return – Last Date 15th October

15th October is the last date for filing  TCS Returns for FY:17-18, Quarter 2.

Typically TCS is applicable on sale of items like scrap, forest products, minerals, bullion, etc. and is covered under section 206C of the Income Tax Act.

Last date for issuing of TCS certificate 30th  October.

Last date for TDS Returns is 31st October.

Source: TDSMan

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Changes in TCS Provisions w.e.f. 1st April, 2017

Budget 2017 – Changes in TCS Provisions

1.Restriction on cash transactions

It is also proposed to consequentially amend the provisions of section 206C to omit the provision relating to tax collection at source at the rate of one per cent. of sale consideration on cash sale of jewellery exceeding five lakh rupees.

This amendment will take effect from 1st April, 2017.
2.Exemption from tax collection at source under sub-section (1F) of section 206C in case of certain specified buyers.
The existing provision of sub-section (1F) of section 206C of the Act, inter-alia provides that the seller who receives consideration for sale of a motor vehicle exceeding ten lakh rupees, shall collect one per cent of the sale consideration as tax from the buyer.

In order to reduce compliance burden in certain cases, it is proposed to amend section 206C, to exempt the following class of buyers such as the Central Government, a State Government, an embassy, a High Commission, legation, commission, consulate and the trade representation of a foreign State; local authority as defined in explanation to clause (20) of Section 10; a public sector company which is engaged in the business of carrying passengers, from the applicability of the provision of subsection (1F) of section 206C of the Act.

This amendment will take effect from 1st April, 2017.

3.Strengthening of PAN quoting mechanism in the TCS regime
Statuary provisions for deduction of tax at source (TDS) at higher rate of 20% or the applicable rate whichever is higher) in case of non-quoting of Permanent Account Number (PAN) is provided under section 206AA of the Act and it exist since April, 2010.

PAN acts as a common thread for linking the information in the departmental data base. It may also be noted that the process of allotment of PAN is made simple and robust. PAN application can be made online and PAN gets allotted in less than a week.

In order to strengthen the PAN mechanism, it is proposed to insert new section 206CC to provide the following:

1. any person paying any sum or amount, on which tax is collectable at source under Chapter XVII BB (hereafter referred to as collectee) shall furnish his Permanent Account Number to the person responsible for collecting such tax (hereafter referred to as collector), failing which tax shall be collected at the twice the rate mentioned in the relevant section under Chapter XVII BB or at the rate of five per cent. whichever is higher.
2. that the declaration filed under sub section (1A) of section 206C shall not be valid unless the person filing the declaration furnishes his Permanent Account Number in such declaration.
3. that in case any declaration becomes invalid under sub-section (2), the collector shall collect the tax at source in accordance with the provisions of sub-section (1).
4. no certificate under sub section (9) of section 206C shall be granted unless it contains the Permanent Account Number of the applicant.
5. the collector knows about the correct PAN of the collectee it is also proposed to provide for mandatory quoting of PAN of the collectee by both the collector and the collectee in all correspondence, bills and vouchers exchanged between them.
6. that the collectee shall furnish his Permanent Account Number to the collector who shall indicate the same in all its correspondence, bills, vouchers and other documents which are sent to collectee.
7. where the Permanent Account Number provided by the collectee is invalid or it does not belong to the collectee, then it shall be deemed that Permanent Account Number has not been furnished to the collector.
8. to exempt the non-resident who does not have permanent establishment in India from the provisions of this proposed section 206CC of the Act.

This amendment will take effect from 1st April, 2017.

Source: TDS Man

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How to tackle with Income Tax Notices ?

Many of my family members & friends are receiving notices from Income tax department; usually any communication from the Income Tax department, especially receiving a notice from them, can send shivers down anyone's spine. A majority of the notices is sent in the normal course of processing returns& might be for routine enquiry or a request for simple clarification, so don’t be panic.

What to do when you receive an Income Tax notice?

1. Don’t Ignore: Handle the situation carefully and sincerely, or you may end up paying a penalty of up to Rs 10,000 along with the tax payment.
2. Back to basics: Check the whether the notice is really meant for you by checking basic things like PAN, Name, Assessment year it related to issuing officer, signature, address with details of ward and circle number. Verify these details to avoid being cheated. To see details go to E filling website see know your AO
3. Preserve the envelope: If the notice comes by snail mail, preserve the envelope. It serves as proof of the dates on which it was posted and received.
4. DIN: If the notice is delivered online, then check the Document Identification Number.
5. Identify the reason behind the notice: By normal reading one can easily indentifies the reason behind notice. Reasons could be a simple mismatch in TDS or inconsistency in your returns, or some serious concerns like income concealment. It can also be a survey or scrutiny of accounts.
6. Validity: Check the validity of the notice and the timely issuance. Also check the section under which the notice has been issued. For example: A notice under Section 143(3) for scrutiny assessment has to be served within six months of the end of the financial year in which the return was filed. If served later than this period, it will be considered invalid.
7. Gather the documents: Start collecting the documents that the department has requested via the notice. Documents needed can vary depending on the gravity of the notice, usually scrutiny notice may ask for several documents, including bank statements, pay-slips, rent receipts and brokerage statements. While it may not be possible to put all this together in the short time.
8. Letter: Prepare a covering letter along with the set of documents.
9. Acknowledgement: Prepare two set of all the documents required, along with a copy of the covering letter. Get your copy stamped to maintain personal records, and as a proof of submission of the documents thereby complying with the notice.
10. Reply on time: Always respond to the notice on time even if you are unable to collect the required documents. You can even ask for some time to gather all the documents. Timely response will help establish that you are honest, and cooperating with the law.
11. CA help : If the notice is simply about a factual matter, such as an arithmetical error, TDS mismatch or deduction amount, a taxpayer should respond on his own, Only when it is a serious issue, such as a notice for scrutiny or reassessment under Section 148, should one get a professional to respond. But A chartered accountant will be better equipped to deal with the situation and provide apt responses.

Interpreting notices under different sections of income tax for individuals
Sec 131(1A): Assessing officer has reason to suspect that income has been concealed.

• Enforcing the attendance of any person, including any officers of a banking company and examining him on oath and completing the production of books of accounts and documents.
• Failure to comply with the summons issued under Section 131(1) has been made punishable with a penalty of Rs 10,000 for each default under Section 272A.

Sec 133(A) : For survey or scrutiny of accounts
Sec 139(9) : For filing defective return
Sec 142    : For not filing the income tax return or for the scrutiny of a documents & accounts in support of the return filed by the tax payer
Sec 143(1) : For adjustment or additional tax demand if an error or incorrect information is detected in the return filed by the tax payer.
Sec 143(2) : For scrutiny assesement after detailed inquiry by assessing officer
Sec 148    : For reassessment if the officer believes some income has escaped assessment.
Sec 156    : For dues(tax, interest,penalty,fine or any other sum) payable by the assessee)
Sec 245    : For adjustment of refund with any demand due

Reasons behind getting Notice :
Return not filed or delayed: Employer deducted tax from you salary. However, Employee did not file the return. In such a case, the tax department will send a notice asking employee to file the return. The notice has to be responded to within the given time. Otherwise, employee may be penalized. Such a notice can be sent for any of the previous six assessment years. In case of delayed filing, the department can levy a penalty of Rs 5,000 a year. However, the penalty is not mandatory, and depends upon the discretion of the assessing officer. However, if any tax is due, the department charges 1% interest per month from the due date.

Mismatch in tax credit: Tax deducted at source, or TDS, figure in your Form 16 may be different from the actual tax credit mentioned in Form 26 AS, a document issued by the income tax department that has all your tax-related information such as tax deducted, refund, etc, against your permanent account number (PAN). In case there is mismatch between the two, the department goes by the figure in Form 26 AS.

The mismatch could be because either the employer has not deposited the tax deducted from your salary with the department or has credited it in someone else's account. In such a case, you have to file a rectified return.

If the employer has not paid the TDS to the tax department, point this out to him. In case the tax has being credited to someone else's account, furnish the TDS certificate to the assessing officer for making the necessary changes.

Investments in the name of spouse
Many individuals resort to purchasing assets in the name of their spouse, children or other close family members in the hope of evading taxes. Assets in this case refer to any kind of investment like land, buildings, fixed deposits, mutual funds, shares, debentures etc.

Let's say x bought mutual funds in your wife¡¦s name. As per section 64 of the Income Tax Act, any income x generate out of these mutual funds is still considered x income and x will be taxed for it.

You need to ensure that you declare such income at the time of filing your return, else you will attract attention from the taxman and receive a notice for the same.

High Value Transactions
High value transactions need to be updated to the Income Tax department by the entity with which you carry out such a transaction. This is in order to ensure taxes are levied as required on each of these transactions in a timely manner. Failure to do so is an invitation for a tax notice.

What qualifies as a high value transaction?

• Cash deposits in a bank worth Rs 10 lakh or more in a year
• Credit card purchases of Rs 2 lakh or more
• Mutual fund investments for Rs 2 lakh or more
• Purchase of bonds and debentures worth Rs 5 lakh or more in a year
• Sale or purchase of property worth Rs 30 lakh or more

Non-disclosure of assets for wealth tax
If you own assets whose net value is over Rs.30 Lakhs, you are liable to pay wealth tax at the rate of 1% of the amount that is above the Rs.30 Lakhs limit. If you do disclose such assets that you own or do not pay taxes on them, there is a good chance that you might receive an IT notice.

Assets can include anything from land, second homes, cars, yachts, gold jewellery, antiques, art etc. If you are unsure about the exact value of the assets you own, you can approach government approved valuers for this purpose.

Random Scrutiny
To enforce tax compliance, the IT department has started randomly scrutinizing returns under section 143 (3). If you receive such a scrutiny notice, don¡¦t panic. Just follow these simple steps:

1. Check the validity of the notice as well as the duration within which you have to respond to the Assessing Officer. Usually, a scrutiny notice is served to the assessee within a period of 6 months from the end of the financial year. Very rarely, notices related to older cases are also sent under section 148, if the Assessing Officer finds genuine reason to do so.
2. Make multiple copies of the notice received
3. Submit documents requested along with a cover letter listing all the documents to the Assessing Officer
4. Request for an acknowledged copy of the cover letter from the Assessing Officer for your own records
5. If the notice is regarding your old dues, they can be adjusted against any pending refund claims made by you for a current year.

What Should One do in a Scrutiny Proceeding ?
 

When you receive notice from Income tax department , Do this things

1. Ensure that all related documents to the assessment proceeding with you.Ex Form 16, 26AS, Previous year ITRs, Proofs for deductions, Wealth tax file, bank accounts, etc… details regarding all monetary transaction
2. For salaried person, keep your Form 16 issued by your employer.
3. All your bank statements .
4. Reasons for high amount transactions.
5. Documents, details asked in notice.
6. If you have received any loan or gift, get a certificate from such person with his complete address on the loan certificate.
7. On hearing date ,you must appear either yourself or through any Chartered Accountant or tax practitioner before the Assessing Officer on the date of hearing.
8. Keep calm & argue politely with A.O. by quoting relevant sections
9. Take acknowledgment for copies submitted
10. Write down relevant points.

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Interactive Voice Response (IVR) application for status of PAN & TAN is now available.

NSDL-TIN has started a new application for status of PAN and TAN which is known as Interactive Voice Response (IVR).  IVR is new application for knowing the status of your PAN/ TAN application which is now available at TIN call centre (TCC) in Hindi/English language. You may call on 020- 27218080 to check the status of your application.

Facility for payment of PAN application fee in Indian Rupees & foreign currency by foreign citizens/NRIs using 'Credit Card/Debit Card' is now available for those applicants who apply PAN online.

Applicant should search for the status of PAN application using Name and Date Of Birth 24 hours after the application has been submitted online or through TIN-FC with  required documents.

Track your PAN/TAN Application Status

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How to check e-TDS Challan Status Query ?

TDSCPC.GOV.IN has also provided a facility to check the Challan Status Query  vide which it can be checked that has there any challan not claimed by deductor in the particular Financial Year or not.  This function is helpful to resolve the default notice issued by Income Tax Department.  

In case any deductor receive demand notice from income tax department, first of all he may check this function for unclaimed challan.  If unclaimed challan is available it means that either complete challans have  not been  entered in etds return or wrong data of challans have been  entered  in TDS return.

There are three types of inquiries available which can be seen in below picture :

1. All.
2. Claimed.
3. Unclaimed.

Period can be entered in specified format i.e. 01-Apr-2013 etc. or dates can be entered only with in financial year. 

Source: www.tdstaxindia.com

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Failure to deduct or remit TDS /TCS.

Interest: Interest at the rates in force (12% p.a.) from the date on which tax was deductible /collectible to the date of payment to Government Account is chargeable. The Finance Act 2010 amended interest rate wef 01.07.2010 and created a separate class of default in respect of tax deducted but not paid to levy interest at a higher rate of 1.5 per cent per month, i.e. 18 per cent p.a. as against 1 per cent p.m., i.e. 12 per cent p.a., applicable in case the tax is deducted late after the due date. The rationale behind this amendment is that the tax once deducted belongs to the government and the person withholding the same needs to be penalized by charging higher rate of interest Penalty equal to the tax that was failed to be deducted/collected or remitted is leviable.

In case of failure to remit the tax deducted/collected, rigorous imprisonment ranging from 3 months to 7 years and fine can be levied.

Failure to apply for TAN in time or Failure to quote allotted TAN or Wrong quoting of TAN :Penalty of Rs.10,000 is leviable u/s.272BB(for each failure)

Failure to issue TDS/TCS certificate in time or Failure to submit form 15H/15G in time or Failure to furnish statement of perquisites in time or Failure to file Quarterly Statements in time: For each type of failure, penalty of Rs.100/- per day for the period of default is leviable. Maximum penalty for each failure can be up to the amount of TDS/TCS. New Section for Penalty for non submission of ETDS /ETDS return (section 271H)(applicable from 01.07.2012)

Failure to deliver statement within time prescribed u/s 200 (3) or to the proviso to sub-section (3) of section 206C may liable to penalty which shall not be less than Rs. 10,000/- but which may extend to Rs. 1,00,000/-. No penalty if payment of tax deducted or collected along with fee or interest and delivering the statement aforesaid before the expiry of 1 year from the time prescribed for delivering the such statement. However No penalty shall be imposed u/s 271H if the person proves that there was reasonable cause for the failure.(section 273B)

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Status of Quarterly TDS/TCS Statement now available by SMS

Recently NSDL has gives us SMS facility to check your TDS/TCS Quarterly Statement Status.  This facility is available on NSDL-TIN Site if the TDS/TCS Deductor register with NSDL.  This facility provides to TDS/TCS Deductor on their Cell which is put while registration of TAN with NSDL.

 

NSDL is pleased to announce that henceforth, NSDL will send SMS for each quarterly TDS/TCS statement processed at TIN. You just need to quote correct latest mobile number in the quarterly TDS/TCS statement. Status as below is provided in the SMS:

• Accepted: This status is provided if the statement is accepted by TIN.
• Rejected: This status is provided if the statement is rejected by TIN.
• Partially accepted: This status is provided if the statement is partially accepted by TIN.
  
  
  The TDS/TCS Deductor can we viewed under the quarterly statement status view available at TIN website for further details.

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For Form 26 AS Part A/B – Details of Tax deducted/Collected at source FAQs.

Before making Form 16A (TDS Certificate) from TIN NSDL website taxpayee must check Tax Credit as Form 26 AS in Part A/B and then confirm it.This is the Details of Tax deducted/Collected at source. And in this regard some common questions are below:

What are the possible reasons for mismatch/missing credits in Parts A/B of my Form 26AS and what action can be taken to rectify?The possible reasons and actions to be taken for mismatch/missing credit being displayed in your Form 26AS can be:

Reasons for mismatch/missing entry in Part A/B	Action to be taken by the assessee
In case the deductor/collector
a) Has not filled quarterly TDS/TCS return.	Follow up with deductor/collector to file TDS/TCS return
b) Has not mentioned or has wrongly quoted your PAN in TDS/TCS return.	Follow up with deductor/collector to file TDS/TCS correction return
c) Has wrongly quoted the challan details in the return against which your TDS/TCS was deposited	Follow up with deductor/collector to file TDS/TCS correction return
d) Has provided correct challan details in TDS/TCS return but bank has made error while digitising challan details	Inform deductor/collector to contact bank for rectification
In case you
a) Have provided incorrect PAN to the deductor/collector	Provide correct PAN to deductor/collector & ask him to file correction return with correct PAN
b) Have not provided PAN to the deductor/collector	Provide PAN to deductor/collector & ask him to file correction return with PAN
The TDS/TCS return filed by the deductor/collector is rejected in the system	Contact your deductor/collector

Date of payment displayed in Form 26AS is different than date mentioned in TDS certificate issued by my deductor/collector. How can I correct it?You should contact your deductor/collector to file revised TDS/TCS return with correct date.
 

I have given incorrect PAN to my deductor. What will be the effect in Form 26AS?
In such cases, the tax payment details will not be posted in Form 26AS. Therefore, it is important for you to correctly state your PAN in your tax payment challans.
 

How can any deductor verify the status of the TDS/TCS returns furnished by him?
The deductor can use the Quarterly Statement Status facility available at TIN website to verify both upload and booking status of the TDS/TCS return uploaded by it.

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On House Rent Income, How to Deduct TDS u/s. 191 I of Income Tax Act.

Any person (not being an individual / HUF whose accounts are not auditable u/s 44AB, clause (a) or (b), responsible for paying rent has to deduct tax at source @20%. However where payment is to an individual or HUF, TDS is to be made @ 15%. TDS is to be done at the time of credit of such income into payee’s a/c or at the time of payment in cash or by chq /draft or any other mode, whichever is earlier.Credit in payers books to a account called suspense a/c or by any other name shall be deemed to be credited to payees’ a/c.

However in case where the rent paid/credited does not exceed Rs.1,20,000/- during the year, no tax is deductible .W.e.f. 1.4.07 the rate of TDS shall be -

• 10% where any machinery plant or equipment is let out
• 15% in case of let out of building or land appurtenant thereto(including factory building) where the payee is an individual or HUF.
• The rate will be 20% in
• above in case the payee is not an individual or HUF.

Essential features of rent are that –

1. Payment is made under any lease, sub-lease tenancy, or any other agreement or arrangement.
2. Payment is made either for use of land or building (including factory building) (together or separately) with or without furniture, fittings & land appurtenant thereto.
3. Immaterial whether land or part of such building is owned by the person to whom rent is paid.

Following points require consideration :

1. If building is let out with furniture & fittings & rent is payable under two separate agreements, composite rent is subject to tax.
2. If a non-refundable deposit is made by tenant, then TDS is applicable.
3. If refundable deposit is paid no TDS to be done, but if deposit carries interest TDS on interest will be governed by Sec. 194A.
4. If municipal taxes, ground rent etc. are borne by tenant no TDS on such sum.
5. Hotel accommodation taken on regular basis by any person other than Individual/HUF will be in the nature of rent and TDS is to be done.
6. No TDS, if payee is Government or local authorities referred to in section 10(20).
7. Payee can make application to the Assessing Officer in Form 13 for a certificate for deduction of tax at lower rate or to deduct no tax.

Deduction of Tax on Service Tax component of rental income vide circular No. 4/2008 of CBDT dt. 28.4.2008 it has been clarified that deduction u/s. 194 I would be required to be made on the amount of rent paid/payable without including the Service Tax. This is so, as Service Tax does not partake the nature of income of the landlord.

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Clarification regarding deemed payment of tax by the employee where FBT on securities is recovered by the employer.

It has been clarified that where fringe benefit tax (with respect to allotment or transfer of specified security or sweat equity shares) has been paid by the employer and subsequently recovered from the employee, the recovery of fringe benefit tax shall be deemed to be the tax paid by such employee in relation to value of fringe benefits provided to him. The deeming provision shall apply only to the extent to which the amount of recovery relates to the value of the fringe benefits provided to such employee.

Further it is provided that, not withstanding anything contained in the Income Tax Act, in the above situation, the employee shall not be entitled for any refund out of such deemed payment of tax; and shall also not be entitled to claim any credit of such deemed payment of tax against tax liability on other income or against any other tax liability.

The provision takes effect from 1st April, 2008 and applies in relation to the assessment year 2008-2009 (previous year 2007- 2008) and subsequent years.

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Latest amendment in TDS Rules w.e.f. 01 November 2011 and onwards.

Income tax department has amend some TDS rules which will be effective from 01-11-2011. The CBDT has also amended e-tds/e-tcs return submission dates w.e.f. 01-11-2011 vide Notification No. 57 issued on dated 24th October, 2011. Earlier there was no change for submission of e-tds/e-tcs return for Government Deductors or Non-Government Deductors. Keeping in view the filing of Form No. 24G regarding data of Government Deductors, due dates for submission of e-tds/e-tcs returns for Government Dedcutors have been changed/increased. Secondly, It is more important that now all data including Non-TDS deducted will be uploaded as mandatory in view of furnishing of declaration under section 197A(complete section detailed given below). In the simple words, now the Form 15G and 15H received by Dedcutors will be reported in e-tds/e-tcs returns as mandatory, earlier It was not mandator as well as Enlarging the scope of grant of TDS credit to person other than the dedcutee.

Income tax department has issued a notification regarding this issue. In this notification income tax department amend rules by:
1. extending the time limit of submission of TDS statements by the Government deductors in view of filing of Form No.24G by them,
2. compulsory uploading of particulars of amount paid without deduction of tax in view of furnishing of declaration under section 197A
3. enlarging the scope for grant of TDS credit to person other than the deductee.

NOTIFICATION:

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
Notification
New Delhi, the 24th October, 2011
INCOME-TAX
S.O. 2429 (E).‐ In exercise of the powers conferred by section 295 of the Income‐tax Act,1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income‐tax Rules, 1962, namely:‐

1. (1) These rules may be called the Income‐tax (Eighth Amendment) Rules, 2011.
(2) They shall come into force on the 1st day of November, 2011.

2. In the Income-tax Rules, 1962, –
(A) in rule 31A –
(a) for sub-rule (2), the following sub-rule shall be substituted, namely:-
“(2) Statements referred to in sub-rule (1) for the quarter of the financial year ending
with the date specified in column (2) of the Table below shall be furnished by –
(i) the due date specified in the corresponding entry in column (3) of the said
Table, if the deductor is an office of Government; and
(ii) the due date specified in the corresponding entry in column (4) of the said Table, if the deductor is a person other than the person referred to in clause
(i).(b) in sub-rule (4), after clause (vi),the following clause shall be inserted, namely:-
“(vii) furnish particulars of amount paid or credited on which tax was not deducted in
view of the furnishing of declaration under sub-section (1) or sub-section (1A) or
sub-section (IC) of section 197A by the payee.”

(B) in rule 37BA, in sub-rule (2), for clause (i), the following clause shall be substituted, namely:-
“(i) where under any provisions of the Act, the whole or any part of the income on which
tax has been deducted at source is assessable in the hands of a person other than the
deductee, credit for the whole or any part of the tax deducted at source, as the case may
be, shall be given to the other person and not to the deductee:

Provided that the deductee files a declaration with the deductor and the deductor reports
the tax deduction in the name of the other person in the information relating to
deduction of tax referred to in sub-rule (1).”

[Notification No. 57 /2011/F. No.142/23/2011-SO(TPL)]
(RAJESH KUMAR BHOOT,)
Director (Tax Policy and Legislation)

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What are the Important points for consideration while filing Quarterly E-TDS Returns?

The taxpayee or TDS Deductor knows about the important points for consideration while filling of Quarterly or Annual e-TDS Returns the following points:

TAN: Quoting of Correct TAN of the deductor is essential.

2. If correction return is being filed then the provisional receipt number of the original return filed should be mentioned.

3. Particulars of the Deductor should be correctly filled, especially the address.

4. The details of tax deducted should be carefully filled, especially the column of section code of the challan, and Challan Identification Number i.e. BSR Code of the Branch of the bank in which challan deposited, date of payment and challan serial number

5. While filling the deductee details correct PAN of the deductee should be mentioned otherwise the deductee would not get the credit of the tax deducted

6. Even if the actual tax deposited through the challan is higher than the total of the amount of tax deducted on account of the deductees, challan details should contain the amount deposited as per the counterfoil only.

7. If TDS for two months (e.g. June and July) is paid using one challan, the same challan details can be repeated in TDS form for both Q1 and Q2. However, it should be ensured that the total TDS deposited for the corresponding deductees during statements for both quarters should be less than or equal to the challan amount.

8. Copy of challan duly filled in before remittance to bank should be retained by the deductor which would enable in filing the quarterly statements correctly.

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Common Terminologies for Tax Deductor

TAN – Every deductor is required to obtain a unique identification number called TAN (Tax Deduction & Collection Account Number) which is a ten digit alpha numeric number

PAN – Permanent account number is the identification number for a tax payer for his assessment purpose

Deductor – The person who is responsible for deduction of tax on particular types of payments being made by them

Deductee – The person whose tax is liable to be deducted on particular types of payments

Financial Year – The Financial year is the year in which the actual transaction takes place i.e. the year in which the tax is to be deducted on particular payments which starts from 1st of April & ends on 31st March e.g. Period from 01.04.2011 to 31.03.2012 is known as F.Y. 2011-12

Assessment Year – The year commences from 1st April subsequent to financial year under consideration. Financial year 2011-12 illustrated above would be A.Y. 2012-13

TIN – Tax Information Network. It comprises of a network system managed & operated by National Securities Depository Limited (NSDL). It receives TDS returns/statements in electronic format through the facilitation centers set up by it on behalf of the Income tax Department

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The New Scheme and Procedure of TDS (Form 16/16A) for Asstt. Year 2012-13

The obligation to deduct tax at source is upon the person responsible for paying the income/amount which is subject to TDS. Therefore such person i.e. payer has to follow the procedure for deducting the tax. The main responsibilities and procedure of TDS may be mentioned as under:

1. W.e.f. 1-10-2004, the payer has to apply for tax deduction and collection account number (TDCAN) IN Form No. 49B. Prior to 1-10-2004, the assessee had to apply for separate tax deduction account number (TAN) and tax collection account number (TCAN). Where the payer has already been allotted TAN or TCAN, he need not apply for TDCAN.

2. He is to deduct tax from the income/payment mentioned in the various sections i.e sections 192 to 196D.

3. The amount so deducted should be deposited in challan No. 281 within the requisite time to the credit of Central Government. Separate challans should be used to deposit tax deducted under each section and the correct nature of payment code in the relevant column is the challan should be indicated.

4. Tax is to be deducted at the basic rates prescribed under various sections. No surcharge, Education Cess or Secondary and Higher Education Cess(SHEC) is to be added to such basic rate except in he following cases:

(a) Tax deduction form payment of salary, whether the recipient is resident or non-resident. In this case Education Cess and SHEC has to be added to the basic rate.
(b) Tax deduction from payment/credit of any sum (other than salary) to a non-resident other than company. In this case also Education Cess and SHEC has to be added to the basic rate.
(c) Tax deduction from payment/credit of any sum to a foreign company. In this surcharge; Education Cess and SHEC shall have to be added to the basic rate. Surcharge @ 2% (2.5% for A.Y. 2011-12) shall be added only when the amount paid/credit exceeds Rs. 1 crore. As per section 206AA, if PAN is not provided, the rate of TDS shall be the normal rate prescribed or 20% whichever is higher.

5. Payee should be issued certificate of tax deduction at source on or before certain specified date.

6. Lastly, the payer should prepare such statements for such period as may be prescribed and file the same with the prescribed income-tax authority or the person authorized by such authority in such form and verified in such manner as may be prescribed.

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Remember Deductee may be penalized when Form 26AS does not match with Form 16/16A.

For the first time perhaps the Central Board of Direct Taxes has chosen to consciously undermine a hoary law still extant, the one Parliament has chosen not to repeal. The tax administration has been exhorting taxpayers not to set store by the TDS certificates they receive, but by what appears in the Tax Information Network (TIN) as tax credit available to them by way of advance tax, tax collected at source and deducted at source.

What this meant was no matter what the TDS certificates said, the TIN information would be held as final and sacrosanct. And more galling would be a situation where a taxpayer has paid an installment of advance tax, but can't claim credit for the same because the bank with which the amount has been deposited has goofed up.

TIN information is compiled out of what the banks with which tax deducted at source is deposited upload into the system and TDS certificates are issued by employers and others obliged to deduct tax at source.

The peremptory message is in case of discrepancy between the two, the former would prevail. This was the first step in dethroning of TDS certificates through an administrative fiat without the backing of the Parliamentary approval.

Going a step further, the tax administration now has exhorted the tax deductors not to issue Form 16/16A on the basis of their own accounting information, but on the basis of the TIN information. And this time round, the peremptory order is being flashed by the ticker in red appearing on its Web site. While the ticker might be construed as a belated attempt to forestall and pre-empt the discrepancy between TIN and TDS certificates by aligning the two peremptorily, the bottom-line is effective marginalization nay annihilation of the true worth of TDS certificates.

The solution worked out by the CBDT to the problem of discrepancy inevitable in a dual system is ham-handed, to say the least. For, the Income-tax Act, 1961 still says that income-tax returns have to be filed on the basis of TDS certificates. Thus if a person has got in his possession TDS certificates obtained from various companies aggregating to Rs 25,000 whereas the TIN shows only Rs 20,000 to his credit, he can claim credit in his income-tax return only for Rs 20,000. . How can he be expected to bear the resultant interest liability for short payment of tax? And In the first place, how can the department place a burden on him for payment of Rs 5,000 when nothing is due from him and the fault is that of the system. The ham-handed solution being attempted is to ask these companies to look up the TIN, and not their own records before issuing the TDS certificates.

This begs the question - why go through the farce of TDS certificates when TIN is in any case going to overrule them.

The plausible explanation is the seeming respect for the mandate of Parliament that TDS certificates still rule the roost. The farce, confusion and contradiction are all going to be heightened when the Department goes ahead with its proposal evinced in its answer to a FAQ that soon it will start sending individual intimations of tax deducted at source to taxpayers from out of the information available in TIN.

Should this happen they would have two sets of documents in their hands - TDS certificates and the consolidated statement 26AS emanating out of TIN. The Department would like the taxpayers to junk the former if they do not reflect faithfully what has been stated in the statement of tax deducted i.e. 26AS. The ticker seeks to nip this possibility in the bud by calling upon tax deductors to set store by TIN, and not by their own records while issuing the certificates. Shouldn't Parliament step in and assert itself? Does it want to give the quietus to the TDS certificates regime?

A dual regime is always confusing and calls for needless reconciliation. Hence, a single unified regime is desirable. But the mandate for this has to come from the Parliament. While migrating to this regime it must be ensured that taxpayers are not put to trouble which is likely to happen should derelict tax deductors either sit on the tax deducted or are remiss in depositing them on time. Taxpayers should not be made to bear the cross for the shenanigans of the tax deductors or the inefficiency of the banking system or the TIN.

Requirement to Verify your Form 16/16A:

Financial Year: Select Financial Year i.e. 2010-11
Quarter: Select your Quarter i.e. Q1, Q2, Q3 or Q4
TAN of the Deductor: Enter TAN of Deductor
PAN of the Deductee: Enter PAN of Detuctee
Certificate Number: Enter TDS Certificate No.
Total Amount Deducted: Enter TDS Amount which you deducted
To Verify TDS Certificate Click Here

Free Download
Income Tax Calculator

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How to Check Jurisdiction of ITR, Ward, Circle, PAN - TDS Status & Refund Status ?

Friends, do you know your Income Tax Jurisdiction, Ward, Circle PAN-TDS and Refund Status, where you submit Income Tax Return. If you aware about it, don't worry. I would like to share with you my personal experience for that.

When I am going to submit my Annual Income Tax Return at nearest Income Tax Department Office, I was face the too problem about my Jurisdiction of Income Tax, I unknown about my Ward/Circle. So, I find the below for you:
Share it and enjoy:

It is very important to know your PAN Jurisdiction and it is too easy to check your pan Jurisdiction (WARD / CIRCLE NUMBER). Simply you Type your correct "Surname", "Date of Birth" or PAN number and just Check your Jurisdiction Click Here.

To check your status Income Tax Return by providing PAN No. We have attached a excel file which will help you to check your Income Tax Return status Click Here.

The Taxpayee did not submit Income Tax Return online or e-Filing and face the problem to get their huge amount of Income Refund after submission of Annual Income Tax Return. The actual/correct and complete online process of income Tax Return Click Here.

As you know TIN-NSDL updates data for TDS/TCS & Income Tax regularly. It helps you to revised your return if their is any correction. The TIN-NSDL provides Software with best utility for taxpayer or tax deductor Click Here.

To get More Information Click Here

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Important changes in TDS/e-TDS, TCS & Its Due Dates

Friends, The important changes in TDS/TDS Procedure w.e.f. 01.04.2010 which is as under:

Latest Due Dates for submitting e-tds returns and issuing form 16 and 16A . Major amendments have been made by CBDT (The Central Board of Direct Taxes) regarding etds. Now Due Dates of etds/etcs returns have been changed and Time period for issuing form 16 and 16A have also been changed.These modifications are not minor.

Changes regarding etds have been made vide Notification No. 41/2010; SO No. 1261(E) dated 31.05.2010. and will be implemented w.e.f. on the Income Tax deducted/collected on or after 01.04.2010. In clarity from Financial Year 2010-11.

PROCEDURE CHANGED W.E.F. 01.04.2010 of TDS/TCS
New Changes in TDS Rules

CBDT Press Release No. 402/92/2006-MC (27 of 2010), dated 2-6-2010

The Central Board of Direct Taxes (CBDT) have amended the Rules relating to TDS provisions date and mode of payment of tax deducted at source (TDS), TDS certificate and filing of ‘statement of TDS’ (TDS return) vide Notification No. 41/2010; SO No. 1261(E) dated 31.05.2010. The amended rules will apply only in respect of tax deducted on or after 1st day of April 2010.

Forms for TDS certificate have been revised to include the receipt number of the TDS return filed by the deductor. Now the Tax-deduction Account Number (TAN) of the deductor, Permanent Account Number (PAN) of the deductee, and Receipt number of TDS return filed by the deductor will form the unique identification for allowing tax credit claimed by the taxpayer in his income-tax return.

Government Authorities (Pay and Accounts Officer or Treasury Officer or Cheque Drawing and Disbursing Officer) responsible for crediting tax deducted at source to the credit of the Central Government by book-entry are now required to electronically file a monthly statement in a new Form No. 24G containing details of credit of TDS to the agency authorised by the Director General of Income-tax (Systems).

Due date for furnishing TDS return for the last quarter of the financial year has been modified to 15th May (from earlier 15th June). The revised due dates for furnishing TDS return are as under:

Sr. No.	Date of ending of the quarter of the Financial Year	Due Dates
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	15the May of the Financial Year immediately following the Financial Year in which deduction is made

Due dates for issuing TDS certificates to the employees or deductees or payees are also revised as under:

Sr. No.	Category	Periodicity of Furnishing TDS Certificate	Due Dates
1.	Salary (Form 16)	Annual	By 31st day of May of the Financial Year immediately following the financial year in which the income was paid and tax deducted.
2.	Non Salary (Form 16A)	Quarterly	With in 15 (Fifteen days) from the due date for furnishing the etds/tcs Statement.

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