Tds Rules And Regulations All Details For Tax Deducted At Source

TDS Rules and Regulations

Categories

Above is not the exhaustive list, however, it is just presented to get a general idea. For e.g. if any person receives income which is taxable under income from business or profession, which is taxed as professional fees or technical consultancy, such income is subject to TDS deduction under section 194J, which should be deducted by the payer. – Aggregate amount not more than Rs.100000 Further, all these categories have exempt thresholds, so TDS deduction is applicable only if the income goes above such threshold. For e.g. if any senior citizen earns income taxable under the head salary then the income would be eligible for TDS only if his gross salary is above Rs.300000.

Compliances for tax deductor

Obtain TAN number for enabling him to deduct TDS.Deduct TDS on every appropriate category of payment at prescribed rate within specified time limit.Pay such tax deducted to the government treasury within due date as prescribed under particular section.File TDS return periodically, issue TDS certificates,

TDS is not applicable where payment is made to

Central or state or local government authoritiesBanksWith respect to interest on Income Tax refund, interest on KVP or NSC,Any other institutes which are granted No TDS certificate by the income tax department

TDS at lower rates

Any person can approach income tax department for granting him the certificate for allowing a lower rate of tax deduction at source. The department will issue such certificate only after observation and inquiry of particular facts and information, which will lead them to determine that the person is not required to be subjected to existing rate of TDS. What happens if TDS is not deducted or paid into the government treasury even if required as per law?

Interest is levied @ 1% from the month in which TDS was required to be deducted till the date when TDS is actually deducted, where TDS was not deductedInterest is levied @ 1.5% for month or part of the month from the due date within which the TDS was required to be deposited till the date of actual deposit, where there is a delay in depositing TDS.The Penalty is leviable at the discretion of joint commissioner under section 271C, who may even impose fine along with imprisonment in most severe cases.

Time framework for TDS deposit

TDS deducted should be deposited within 7 days from the end of the month on which TDS was so deducted.For TDS deducted in the month of March, TDS should be deposited on or before 30th April of the next financial year.