TDS Compliance
& Return Filing

TDS (Tax Deducted at Source) is a mechanism where the person making a payment deducts tax at prescribed rates before paying the recipient. The deducted amount is deposited with the government on behalf of the payee. TDS applies on salary, rent, professional fees, contractor payments, interest, commissions, and more as specified under the Income Tax Act.

Companies, LLPs, partnership firms, trusts, and individuals/HUFs whose accounts are audited under Section 44AB must deduct TDS. Government offices must also deduct TDS. Any person with a valid TAN making specified payments above the threshold limit must deduct and deposit TDS with the government.

TDS returns (24Q, 26Q, 27Q) must be filed quarterly: Q1 (Apr-Jun) by July 31, Q2 (Jul-Sep) by October 31, Q3 (Oct-Dec) by January 31, Q4 (Jan-Mar) by May 31. TDS payment must be deposited by the 7th of the following month (30th April for March deductions). Form 27EQ has earlier deadlines.

Late deduction: interest at 1% per month from due date. Late deposit: interest at 1.5% per month from deduction date. Late filing: Rs 200 per day (capped at TDS amount). Non-filing: penalty of Rs 10,000 to Rs 1 lakh under Section 271H. The deductor is also responsible for depositing TDS even if not deducted from payee.

Form 16 is a TDS certificate issued by employers to employees for salary TDS (under Section 192). It contains salary details, tax deductions, and Part A/Part B. Form 16A is issued for TDS on non-salary payments — rent, professional fees, contractor payments, etc. Both are generated from TRACES after filing quarterly returns.

We regularly check TRACES for defaults — short payment, short deduction, late filing, PAN errors. For corrections, we file correction statements (C1 for challan corrections, C2 for deductee details). We also handle demand notices from CPC-TDS and file revised returns when needed to resolve all outstanding defaults.