Do’s & Don’t’s for TDS Returns

Given below are some dos and don’t for filing of TDS returns:

Dos

  1. Ensure that TDS return is filed with same TAN against which TDS payment has been made.
  2. Ensure that correct challan particulars including CIN and amount is mentioned.
  3. Correct PAN of the deductee is mentioned.
  4. Correct section is quoted against each deductee record.
  5. Tax is deducted at correct rate for each deductee record.
  6. File correction statement as soon as discrepancy is noticed.
  7. Issue TDS certificate downloaded from TRACES website.

Dont’s

  1. Don’t file late returns as it affects deductee tax credit.
  2. Don’t quote incorrect TAN vis-à-vis TDS payments.

Complete Procedure for Refund/Demand Status, Request for Refund Re-issue.

After making any payments either Salary or Interest TDS is required to be deducted as per Income Tax from Deductee.  If the TDS Deducted Amount is excess than TAX liability amount in this conduction, the excess paid TDS returned to Taxpayee after TAX Assessment by Income Tax Department.  But, some times the refund of TDS or excess paid tax unable to get taxpayee due to following reasons :
  1. Expired Cheque
  2. Incorrect A/C No
  3. House Locked
  4. Party Shifted
  5. No such Address
  6. No such person
  7. Incorrect MICR code/unavailable
  8. Account has been closed
  9. Account Description incorrect
  10. Others
  11. Mendatory fields missing (Account Number/Account Name/Account type/Address/City/State/Pincode)
  12. Incorrect A/c Number Length
  13. Invalid A/c. No.
  14. Invalid A/c. No. (Between to special characters there shoube be atleast one alphabet/number)
  15. Invalid A/c Number (First character in A/c. No. should be an alphabet/number only.)
  16. Invalid A/c. No. (Last Character in A/c. No. should be a number.)
  17. Invalid A/C Number (Numeric string between alphabets or special characters cannot be all zeros)
  18. Invalid character in A/c. Number
  19. Address not valid (Invalid Characters or too long Address)
  20. Invalid character in Account Name or Name too short
  21. No numeric digit in Account Number
  22. Invalid IFSC Code
  23. Name mismatch with Bank Account Hoder

 

View Refund/ Demand Status

To view Refund/ Demand Status, please follow the below steps:
Step – 1 :    Login to e-Filing website with User ID, Password, Date of Birth / Date of Incorporation and Captcha.
Step – 2 :    Go to My Account and click on “Refund/Demand Status”.
Step – 3 :    Below details would be displayed.
* Assessment Year
* Status
* Reason (For Refund Failure if any)
* Mode of Payment is displayed.

How to Request for Refund Re-issue (in case of refund failure)

To request for Refund Re-issue, please follow the below steps:
Step – 1 :    Login to e-Filing website with User ID, Password, Date of Birth/ Date of Incorporation and Captcha.
Step – 2 :    Go to My Account and click on “Refund Re-issue Request”.
Step – 3 :    Enter PAN, Assessment Year, CPC Communication Reference Number, Refund Sequence Number (available on the 143(1) Intimation order and Click on ‘Validate’ button.
Step – 4 :    After validation, taxpayer can select the mode of Refund Reissue from the options.
The two modes of Refund Reissue are:
* ECS
* By Paper (Cheque)
Step – 5 :    Taxpayer can select to update the Bank Account Details from the option under the field ‘Do you want to update Bank Account details?
‘If the taxpayer selects ‘Yes’, taxpayer has to enter details in the additional fields i.e. Bank Account number, Type of Account and IFSC code/ MICR code.
Step – 6 :    Taxpayer can select the address to which the cheque has to be sent under the dropdown ‘Category’.
If the taxpayer selects ‘ITR Address’, address provided in the ITR uploaded is used.
If the taxpayer selects ‘PAN Address’, address provided in the PAN is used.
If the taxpayer selects ‘New Address’, taxpayer has to enter details in the additional fields displayed.
Step – 7 :    Taxpayer clicks on “Submit” to validate the details.
On successful validation, Taxpayer will get the message success message .

To View Complete Procedure (Click Here)
To Download Complete Procedure (Click Here)

Advisory regarding Lower Deduction Certificate for Deductor(s)

Advisory for Deductors

  1. Deductors deduct tax at lower rate on payment/credit to deductee on production of certificate duly issued by assessing officers under section 197. Deductors quote such certificate number in quarterly TDS statement. Instances of huge default of ‘Short Deduction’ have been observed due to wrong quoting of 197 certificate number. The scenario of wrong 197 certificate generally arises when the deductor accepts from deductee a manually issued lower deduction certificate by assessing officer & quotes the same in TDS statements.
  1. CPC TDS has provided the facility of validating the 197 certificate to the deductors on TRACES. This enables a deductor to first validate the 197 certificates given to him by their deductees and then furnish the same in the TDS/TCS statement.
  1. If the 197 certificate is not valid as per TRACES validation, the deductor should always insist upon an ITD system generated certificate having a unique 10 digit alpha numeric number. This would minimize the generation of default of “Short Deduction due to 197 certificate”.
  1. This also applies to certificates issued under section 195(2) & 195(3) by LTU & international taxation officers.
  1. Instruction to field authorities to issue only system generated certificate were issued vide instruction No. 36 through F.No. SW/TDS/2/2/08-DIT(S)-II[Vol.II] dated July 15th, 2009 ( copy enclosed).

Click here to download TDS Instruction No. 36.

Basic principles of TDS Compliance

The following are the basic principles of TDS compliance:

  1. Deduction/ Collection of Tax at Correct Rates
  2. Timely Deposit of Tax Deducted at Source
  3. Accurate Reporting of data related to tax deductions/ collections made
  4. Submission of TDS Statements within the due dates
  5. Verification and Issuance of TDS Certificates within time
  6. CPC (TDS) is now sending “Intermediate Default Communication” for PAN Errors and Short Payments, which can be corrected during the interim period of a week of filing TDS Statements, before CPC (TDS) proceeds with computing Defaults for the relevant statement.
  7. User-friendly Online Correction facility can be used for Correction of Deductees, Tagging Unmatched Challans and Payment of Fees/ Interest. (Please navigate to Defaults tab to locate Request for Correction from the drop-down menu. For any assistance, please refer to the e-tutorial available on TRACES).
  8. Aggregated TDS Compliance Report assists the PAN of the Deductor to administer TDS Defaults for associated TANs and to take appropriate action
  9. The Deductor’s Dashboard provides you all necessary information to assist you in “Compliance Self-Assessment” and to take appropriate action.
  10. Non-filing Self-declaration can be made by navigating to Statements / Payments menu and submit details under Declaration for Non-Filing of Statements.
  11. PAN Verification and Consolidated TAN – PAN File facility on TRACES can be used for verifying the deductees.
  12. The Conso Files and Justification Reports downloaded from TRACES help you to identify errors in submission of revised Quarterly TDS Statements.