sanjeev ghai, sanjeev ghai irs, sanjeev ghei, sanjeev ghai income tax

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All you want All you want to know to know about about TDS TDS Team Professional Times Team Professional Times

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Sanjeev ghai, Sanjeev ghei, Sanjeev ghai income tax, Sanjeev ghai irs

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Page 1: Sanjeev ghai, sanjeev ghai irs, sanjeev ghei, sanjeev ghai income tax

All you want All you want to know to know about about TDSTDS

Team Professional TimesTeam Professional Times

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Objectives behind TDSObjectives behind TDS

Pay as you EarnPay as you Earn

Regular Cash InflowRegular Cash Inflow

Avoid EvasionAvoid Evasion

Widening of Tax BaseWidening of Tax Base

Shift the ResponsibilityShift the Responsibility

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TAN RegistrationTAN Registration

• Visit “tin-nsdl.com”Visit “tin-nsdl.com”• Click – “Online TAN Registration” at home Click – “Online TAN Registration” at home

pagepage• Furnish Furnish Details of Deductor/Collector Details of Deductor/Collector • Furnish Furnish Contact Details of Deductor/Collector Contact Details of Deductor/Collector • Mention details of any regular e-TDS / TCS Mention details of any regular e-TDS / TCS

quarterly statement accepted in TIN on or quarterly statement accepted in TIN on or after April 01, 2008. after April 01, 2008.

• Select the user ID and password for operating Select the user ID and password for operating TAN account.TAN account.

• Select security question and corresponding Select security question and corresponding answer.answer.

• Click ‘Submit’.Click ‘Submit’.

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TAN RegistrationTAN Registration• On successful registration of TAN online, a 12 On successful registration of TAN online, a 12

digit alpha numeric registration number will digit alpha numeric registration number will generated.generated.

• After successful registration, TAN account is After successful registration, TAN account is activated within three hours.activated within three hours.

• User ID (as created by user) is e-mailed on the User ID (as created by user) is e-mailed on the e-mail ID registered at TIN.e-mail ID registered at TIN.

• Password for login would be the same which Password for login would be the same which you have mentioned while creating your TAN you have mentioned while creating your TAN Registration Account. Registration Account.

• Log in page can be accessed under the menu Log in page can be accessed under the menu “login” at home page under the option “TAN “login” at home page under the option “TAN Account” or click on Account” or click on https://onlineservices.tin.nsdl.com/TIN/JSP/security/TanLogin.jsp

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How to download Form 16A from How to download Form 16A from TINTIN

BackgroundBackground• As per Income Tax Department (ITD) circular no. 03/2011 dated May As per Income Tax Department (ITD) circular no. 03/2011 dated May

13, 2011 Companies and Banks are required to issue Form 16A from 13, 2011 Companies and Banks are required to issue Form 16A from TIN to their deductees for deductions made from April 1, 2011 (F.Y. TIN to their deductees for deductions made from April 1, 2011 (F.Y. 2011-12).2011-12).

• Form 16A is available to registered TANs at TIN w.e.f F.Y. 2010-11.Form 16A is available to registered TANs at TIN w.e.f F.Y. 2010-11.

• Form 16A can be requested from TIN by all category of deductors Form 16A can be requested from TIN by all category of deductors (example; Individual, Firm, HUF, Company, Government, etc.)(example; Individual, Firm, HUF, Company, Government, etc.)

ProcedureProcedure• Login to TAN Account at TIN website by entering your user ID, Login to TAN Account at TIN website by entering your user ID,

password & TAN. password & TAN.

• Log in page can be accessed under the menu “login” at home page Log in page can be accessed under the menu “login” at home page under the option “TAN Account” .under the option “TAN Account” .

• After login , request for Form 16A file by clicking on ‘After login , request for Form 16A file by clicking on ‘Form 16A file Form 16A file requestrequest’ option.’ option.

• Mention Financial year & Quarter for which form 16A is required.Mention Financial year & Quarter for which form 16A is required.

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How to download Form 16A from How to download Form 16A from TINTIN

Procedure contd.Procedure contd.• Enter updated verification details such as, Enter updated verification details such as,

a) Challan / Voucher No. of any one Challan as reported in the TDS a) Challan / Voucher No. of any one Challan as reported in the TDS statement for that quarter.statement for that quarter.b) Provide details of any three distinct deductee records (valid PAN and b) Provide details of any three distinct deductee records (valid PAN and corresponding deducted amount) present in the TDS/TCS statement. corresponding deducted amount) present in the TDS/TCS statement.

• Request for Form 16A can be placed either for all PANs or Request for Form 16A can be placed either for all PANs or

• for a single PAN for which statement has been filed in the quarter. for a single PAN for which statement has been filed in the quarter. • ((Now one can request Form 16A for 10 PANs at a time).Now one can request Form 16A for 10 PANs at a time).• On selecting the option for Form 16A for Individual PAN, deductor On selecting the option for Form 16A for Individual PAN, deductor

needs to fill in the PAN of the deductee for which Form 16A is required.needs to fill in the PAN of the deductee for which Form 16A is required.

• After successful verification, request number is generated and the Form After successful verification, request number is generated and the Form 16A Text file in compressed format (.zip) is e-mailed to the user within 16A Text file in compressed format (.zip) is e-mailed to the user within 48 hours on the e-mail ID provided at the time of TAN registration. 48 hours on the e-mail ID provided at the time of TAN registration.

• If Form 16A file is greater than 2 MB after zipping, then the Form 16A If Form 16A file is greater than 2 MB after zipping, then the Form 16A zip files will be sent in multiple files of 2 MB.zip files will be sent in multiple files of 2 MB.

• In order to convert the text file into PDF, user has to download PDF In order to convert the text file into PDF, user has to download PDF Converter Utility from the TAN account.Converter Utility from the TAN account.

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How to download Form 16A from How to download Form 16A from TINTIN Procedure contd.Procedure contd.

• After downloading the Utility, double click on After downloading the Utility, double click on ‘‘Start_Form16A_Utility.batStart_Form16A_Utility.bat’ to operate the Form 16A PDF Converter ’ to operate the Form 16A PDF Converter Utility.Utility.

• Extract Zip file containing Form 16A data in text form by using WinZip Extract Zip file containing Form 16A data in text form by using WinZip version 9.0 and above, WinRaR version 3.90 and above and 7-Zip version 9.0 and above, WinRaR version 3.90 and above and 7-Zip version 4.65 and above.version 4.65 and above.

• Extract zip file by providing the TAN registration number. Extract zip file by providing the TAN registration number.

• Open the “Form 16A PDF converter utility” by double clicking the file Open the “Form 16A PDF converter utility” by double clicking the file ““PDF Converter Utility.jarPDF Converter Utility.jar”.”.

• Click on “Browse” button of “Click on “Browse” button of “Form 16A Input File Name with PathForm 16A Input File Name with Path” and ” and provide path of Form 16A text files. provide path of Form 16A text files.

• Option to digitally sign or manually sign Form 16A is available.Option to digitally sign or manually sign Form 16A is available. Procedure to generate Form 16A PDF File with Digital SignatureProcedure to generate Form 16A PDF File with Digital Signature

• Browse and select Input file Form 16A text file received from TIN Browse and select Input file Form 16A text file received from TIN website.website.

• Browse and select Output file path to generate Form 16A PDF file.Browse and select Output file path to generate Form 16A PDF file.

• Browse and select DSC to digitally sign Form 16A PDF.Browse and select DSC to digitally sign Form 16A PDF.

• Enter Password of DSC.Enter Password of DSC.

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How to download Form 16A from How to download Form 16A from TINTIN Procedure contd.Procedure contd.• Provide details of responsible person to be printed on Form 16A.Provide details of responsible person to be printed on Form 16A.

• Click to generate PDF.Click to generate PDF.

• Form 16A PDF will be generated in a folder.Form 16A PDF will be generated in a folder.

• Nomenclature of the folder: TAN_Form16A_FY_Quarter_date of PDF Nomenclature of the folder: TAN_Form16A_FY_Quarter_date of PDF conversion.conversion. For example: AGRA10001E_FORM16A_2011-12_Q1_20-06-2011For example: AGRA10001E_FORM16A_2011-12_Q1_20-06-2011

• Form 16A PDF will be generated PANwise.Form 16A PDF will be generated PANwise.

• Nomenclature of PDF: PAN_Form16A_2011-12_Quarter.pdfNomenclature of PDF: PAN_Form16A_2011-12_Quarter.pdf For example: AAACA1924F_FORM16A_2011-12_Q1.pdf For example: AAACA1924F_FORM16A_2011-12_Q1.pdf

• Form 16A file is generated for valid PANs only.Form 16A file is generated for valid PANs only.

• For deductee records with invalid PANs or PAN which are not For deductee records with invalid PANs or PAN which are not present in the Income Tax Department database, PDF will not be present in the Income Tax Department database, PDF will not be generated. generated.

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How to download Form 16A from How to download Form 16A from TINTIN Procedure contd.Procedure contd.

• Form 16A from TIN will contain the following details:– Six digit unique Form 16A certificate number

– TAN of Deductor

– PAN of the deductee

– Name and Address of Deductor and Deductee*

– Name of Commissioner of Income Tax (TDS)

– Assessment Year and Period (quarter)

– Nature of payment wise details of amount paid/credited

*Name and address of TAN and PAN will be as per data available in ITD database

– Status of Booking

– Summary of tax deducted at source in respect of deductee

– Details of tax deducted and deposited through challans

– Details of tax deducted and deposited through transfer voucher

– ‘Last Updated’ date till which details of Form 16A is updated

– Verification and responsible person details

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Request for consolidated TDS/TCS Request for consolidated TDS/TCS FileFile

• Login to the TAN login account with the registered Login to the TAN login account with the registered user id, password and TAN & request for consolidated user id, password and TAN & request for consolidated e-TDS/TCS statement.e-TDS/TCS statement.

• Users can request for consolidated e-TDS/ TCS Users can request for consolidated e-TDS/ TCS statements from F.Y. 2005-06 onwards, earlier it was statements from F.Y. 2005-06 onwards, earlier it was available from F.Y. 2007-08 onwards.available from F.Y. 2007-08 onwards.

• Consolidated TDS/ TCS files can be requested only for Consolidated TDS/ TCS files can be requested only for TDS/TCS statements accepted at TIN central system.TDS/TCS statements accepted at TIN central system.

• Please check status of TDS/TCS statement at the TIN Please check status of TDS/TCS statement at the TIN website under ‘Quarterly Statement Status’ view.website under ‘Quarterly Statement Status’ view.

• Enter details of accepted regular statement: 15 digit Enter details of accepted regular statement: 15 digit PRN/token, Form No., Quarter & Financial Year.PRN/token, Form No., Quarter & Financial Year.

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Request for consolidated TDS/TCS Request for consolidated TDS/TCS File contd.File contd.

• Enter updated verification details such as, Enter updated verification details such as, a) Challan / Voucher No. of any one Challan as reported in the a) Challan / Voucher No. of any one Challan as reported in the TDS statement for that quarter.TDS statement for that quarter.b) Provide details of any three distinct deductee records b) Provide details of any three distinct deductee records (valid PAN and corresponding deducted amount) present in (valid PAN and corresponding deducted amount) present in the TDS/TCS statement. the TDS/TCS statement.

• After successful verification, request number is generated After successful verification, request number is generated and the consolidated TDS/TCS statement is e-mailed to the and the consolidated TDS/TCS statement is e-mailed to the user within 24 hours on the e-mail ID (s) provided at the time user within 24 hours on the e-mail ID (s) provided at the time of TAN registration. of TAN registration.

• There is also an option to Download / View Status of There is also an option to Download / View Status of Consolidated TDS/TCS File.Consolidated TDS/TCS File.

• TDS/TCS file is available for download maximum for a period TDS/TCS file is available for download maximum for a period of thirty days (earlier it was available for 7 days).of thirty days (earlier it was available for 7 days).

• You can also check the status of the request for consolidated You can also check the status of the request for consolidated file for which request is placed either by entering the file for which request is placed either by entering the Reference No. or the period between which request is raised. Reference No. or the period between which request is raised.

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IMPORTANT TERMINOLOGIES & TYPE OF IMPORTANT TERMINOLOGIES & TYPE OF STATEMENTSSTATEMENTS

• Receipt Number:Receipt Number: To be quoted on Form 16/16A. Applicable To be quoted on Form 16/16A. Applicable for statements pertaining to FY 2010-11 and onwards. for statements pertaining to FY 2010-11 and onwards.

• Provisional Receipt Number:Provisional Receipt Number: Referred as Token Number Referred as Token Number w.e.f FY 2010-11 and onwards. w.e.f FY 2010-11 and onwards.

• Statement Type (Transaction Type)Statement Type (Transaction Type)   

Regular (Original):Regular (Original): First First statement furnished by a TAN for statement furnished by a TAN for a quarter for a form. a quarter for a form.   

Correction (C1):Correction (C1): Type of correction statement which can Type of correction statement which can update deductor details (excluding TAN).update deductor details (excluding TAN).  

Correction (C2):Correction (C2): Type of correction statement which can Type of correction statement which can update deductor (excluding TAN) and/or challan details.update deductor (excluding TAN) and/or challan details.  

Correction (C3):Correction (C3): Type of correction statement which can Type of correction statement which can update deductor (excluding TAN) and/or challan and/or update deductor (excluding TAN) and/or challan and/or deductee details. deductee details.   

Correction (C4):Correction (C4): Addition/Deletion of Salary detail records Addition/Deletion of Salary detail records (Applicable only for 24Q Q4).(Applicable only for 24Q Q4).  

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IMPORTANT TERMINOLOGIES & TYPE OF IMPORTANT TERMINOLOGIES & TYPE OF STATEMENTSSTATEMENTS contd.contd.

Correction (C5):Correction (C5): Type of correction statement which can Type of correction statement which can update PAN of deductee. update PAN of deductee.   

Correction (C9):Correction (C9): Type of correction statement which can add a Type of correction statement which can add a challan and its underlying deductees. challan and its underlying deductees.   

Correction (Y):Correction (Y): Type of correction statement to cancel the Type of correction statement to cancel the regular statement (only in case of TAN change). regular statement (only in case of TAN change).   

• Status of Quarterly StatementsStatus of Quarterly Statements    Accepted by TIN:Accepted by TIN: Indicates Indicates the statement has been received the statement has been received

by the TIN central system but the challans within the statement by the TIN central system but the challans within the statement may or may not have been matched. may or may not have been matched.   

Partially accepted by TIN:Partially accepted by TIN: This This status will be displayed only status will be displayed only for C5 correction, if some deductee records are rejected.for C5 correction, if some deductee records are rejected.   

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Dos & Dont's for filing TDS Dos & Dont's for filing TDS ReturnsReturns

• DosDos

• Ensure that correct challan particulars including CIN Ensure that correct challan particulars including CIN and amount is mentioned. and amount is mentioned.

• Correct PAN of the deductee is mentioned. Correct PAN of the deductee is mentioned. • Correct section is quoted against each deductee Correct section is quoted against each deductee

record. record. • Correct rate is quoted against each deductee Correct rate is quoted against each deductee

record. record. • File correction statement as soon as discrepancy is File correction statement as soon as discrepancy is

noticed noticed • Retain the original FVU file to enable future Retain the original FVU file to enable future

corrections corrections • Make use of free of charge RPU provided through Make use of free of charge RPU provided through

TIN-NSDL.com TIN-NSDL.com • Download details of challan from challan status Download details of challan from challan status

enquiry (TAN based view) from TIN-NSDL.com enquiry (TAN based view) from TIN-NSDL.com

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Dos & Dont's for filing TDS Returns Dos & Dont's for filing TDS Returns contd.contd.• Always verify status of TDS returns from TIN-NSDL.COM Always verify status of TDS returns from TIN-NSDL.COM

to ascertain the discrepancy, if any, and/or whether to ascertain the discrepancy, if any, and/or whether your TDS return stands accepted or rejected by the your TDS return stands accepted or rejected by the system. system.

• Mention the details of Transporter in your Return and maintain Mention the details of Transporter in your Return and maintain the records of Transporter and obtain a copy of their PAN card. the records of Transporter and obtain a copy of their PAN card.

• Use Use challan type 281challan type 281 for deposit of TDS/TCS amount.  for deposit of TDS/TCS amount. • Quote Quote correct TAN, full name, addresscorrect TAN, full name, address  and current and current

A.Y.A.Y. on each challan.  on each challan. • Use Use separate challanseparate challan for  for different nature of different nature of

paymentspayments quoting correct nature of payment code and also for  quoting correct nature of payment code and also for different type of deductee. different type of deductee.

• Ensure that the bank has mentioned Ensure that the bank has mentioned CINCIN (Challan Identification  (Challan Identification Number) on the counter foil. Number) on the counter foil. Verify CIN detailsVerify CIN details uploaded by  uploaded by the bank to TIN i.e., 5 digit challan serial no., BSR code of 7 the bank to TIN i.e., 5 digit challan serial no., BSR code of 7 digit and date. digit and date.

• Insist on computerized receipts from the bank Insist on computerized receipts from the bank • E- payment of TDS is recommended. (As in case of lost challan E- payment of TDS is recommended. (As in case of lost challan

Duplicate copy can be easily printed from bank website by Duplicate copy can be easily printed from bank website by loging in with your ID and password) loging in with your ID and password)

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Dos & Don'ts for filing TDS Returns Dos & Don'ts for filing TDS Returns contd.contd.

Don'tsDon'ts

• Don't file late returns as it affects deductee tax credit. Don't file late returns as it affects deductee tax credit. • Don't quote incorrect TAN vis-à-vis TDS payments. Don't quote incorrect TAN vis-à-vis TDS payments. • Do not late deposit TDS as it attracts penal interest (Raised Do not late deposit TDS as it attracts penal interest (Raised

from 1% to 1.5% per annum w.e.f. 01.07.2010) as well as from 1% to 1.5% per annum w.e.f. 01.07.2010) as well as penalty us/ 221. penalty us/ 221.

• Don't quote Don't quote wrong TANwrong TAN or use PAN in place of TAN or vice  or use PAN in place of TAN or vice versa. versa.

• Don't use a Don't use a single challansingle challan for corporate and non- for corporate and non-corporate deductees. corporate deductees.

• If one has multiple TANs, If one has multiple TANs, use one TAN onlyuse one TAN only consistently  consistently and surrender the others. and surrender the others.

• Don't use preprinted challans Don't use preprinted challans without verifying without verifying TAN/PAN.TAN/PAN.

• Each branch/division of an entity will have a separate TAN if Each branch/division of an entity will have a separate TAN if it is filing separate TDS/TCS returns.  However, there will be it is filing separate TDS/TCS returns.  However, there will be only one PAN for a legal entity. only one PAN for a legal entity.

• Do not make mistake in indicating the Do not make mistake in indicating the Assessment Assessment YearYear in the challan.  in the challan.

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FAQs relating to Preparation of FAQs relating to Preparation of Correction StatementCorrection Statement

• How many times can I furnish a correction TDS/TCS How many times can I furnish a correction TDS/TCS statement?statement?

• A correction TDS/TCS statement can be furnished multiple A correction TDS/TCS statement can be furnished multiple times to incorporate changes in the regular TDS/TCS times to incorporate changes in the regular TDS/TCS statement whereas a regular TDS/TCS statement will be statement whereas a regular TDS/TCS statement will be accepted at the TIN central system only once.accepted at the TIN central system only once.

• What are the important points to be kept in mind while What are the important points to be kept in mind while preparing correction statement more than once on the preparing correction statement more than once on the same regular statement?same regular statement?

• You have to kept in mind, the following points while You have to kept in mind, the following points while preparing correction statement more than once on the preparing correction statement more than once on the same regular statement:same regular statement:

• 1. The TDS/TCS statement on which correction is to be 1. The TDS/TCS statement on which correction is to be prepared should be updated with details as per all previous prepared should be updated with details as per all previous corrections.corrections.2. Modifications/addition/deletion in correction statements 2. Modifications/addition/deletion in correction statements accepted at the TIN central system only should be accepted at the TIN central system only should be considered.considered.

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FAQs relating to Preparation of FAQs relating to Preparation of Correction Correction

StatementStatement contd.contd.• How many times can I update PAN of a How many times can I update PAN of a

deductee/transacting party?deductee/transacting party?

• Structurally valid PAN of a deductee in the Structurally valid PAN of a deductee in the regular statement can be updated to another regular statement can be updated to another structurally valid PAN only once.structurally valid PAN only once.

• When does a statement get ‘Partially When does a statement get ‘Partially Accepted’?Accepted’?

• A correction statement containing updates in A correction statement containing updates in PAN of deductee/employee may get Partially PAN of deductee/employee may get Partially Accepted. This is possible when the PAN in the Accepted. This is possible when the PAN in the any of the records being updated by you in the any of the records being updated by you in the correction statement is invalid, i.e. PAN not correction statement is invalid, i.e. PAN not present in PAN Master Database. In such a present in PAN Master Database. In such a scenario, the said record gets rejected resulting scenario, the said record gets rejected resulting in partial acceptance of the statement.in partial acceptance of the statement.

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FAQs relating to Preparation of FAQs relating to Preparation of Correction Correction

StatementStatement contd.contd.• Which Provisional Receipt Number / Token Number Which Provisional Receipt Number / Token Number

should I quote while preparing correction statement should I quote while preparing correction statement more than once on the same regular statement?more than once on the same regular statement?

• There are two fields for Provisional Receipt Number There are two fields for Provisional Receipt Number (PRN) / Token Number in a correction statement as (PRN) / Token Number in a correction statement as under:under:a. a. Original Provisional Receipt Number / Token Original Provisional Receipt Number / Token NumberNumber – PRN of the regular statement should be – PRN of the regular statement should be mentioned in this field.mentioned in this field.b. b. Previous Provisional Receipt Number / Token Previous Provisional Receipt Number / Token NumberNumber – PRN of the last accepted correction – PRN of the last accepted correction statement should be mentioned in this field. In case statement should be mentioned in this field. In case the value in this field is incorrectly mentioned, the the value in this field is incorrectly mentioned, the statement will get rejected at TIN central system statement will get rejected at TIN central system for the reason: for the reason: “Either Previous Provisional Receipt “Either Previous Provisional Receipt No. provided is incorrect or combination of Original No. provided is incorrect or combination of Original Provisional Receipt Number / Token Number and Provisional Receipt Number / Token Number and Previous Provisional Receipt Number / Token Previous Provisional Receipt Number / Token Number is not in sequence”Number is not in sequence”

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Precautions :Precautions :

Before uploading any Income Tax Before uploading any Income Tax ReturnReturn : :

a) Reconcile the same with Form 26AS. a) Reconcile the same with Form 26AS. It will help you, not only in claiming It will help you, not only in claiming the correct TDS, but it shall also assist the correct TDS, but it shall also assist you in declaring true & correct Income you in declaring true & correct Income of the Assessee. of the Assessee.

b) Reconcile the Profit & Loss Account b) Reconcile the Profit & Loss Account with Quarterly Statement of TDS. with Quarterly Statement of TDS. Major Expenditure heads which should Major Expenditure heads which should be reconciled are as follows: be reconciled are as follows:

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Precautions : contd.Precautions : contd.

Job & Labour Charges.Job & Labour Charges. Advertisement.Advertisement.

Packing & forwarding.Packing & forwarding. Freight & Cartage.Freight & Cartage.

Audit Fees.Audit Fees. Rent/ Hire Charges.Rent/ Hire Charges.

Commission & Brokerage.Commission & Brokerage. Printing & Stationery.Printing & Stationery.

Interest paid.Interest paid. Repair & maintenance/AMC Repair & maintenance/AMC ..

House Keeping Charges.House Keeping Charges. Postage & Courier.Postage & Courier.

Staff Recruitment.Staff Recruitment. Software Expenses.Software Expenses.

EDP Expenses/ Computer EDP Expenses/ Computer Maintenance.Maintenance.

Legal & Professional Legal & Professional Charges.Charges.

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Recent Circulars & Notifications:Recent Circulars & Notifications:

CIRCULAR NO.07/2011Dated: Sept. 27, 2011CIRCULAR NO.07/2011Dated: Sept. 27, 2011

• Amendment to Circular No.7/2007 regarding Procedure Amendment to Circular No.7/2007 regarding Procedure for refund of tax deducted at source under section 195 for refund of tax deducted at source under section 195 to the person deducting tax.to the person deducting tax.

Circular No.7/2007 dated 23.10.2007 lays down the procedure for Circular No.7/2007 dated 23.10.2007 lays down the procedure for refund of tax deducted at source under section 195 of the refund of tax deducted at source under section 195 of the Income Tax Act, 1961 to the person deducting tax at source from Income Tax Act, 1961 to the person deducting tax at source from the payment to a non-resident.the payment to a non-resident.The above circular does not cover a situation where the tax is The above circular does not cover a situation where the tax is deducted at a rate prescribed in the relevant DTAA which is deducted at a rate prescribed in the relevant DTAA which is higher than the rate prescribed in the Income Tax Act, hence higher than the rate prescribed in the Income Tax Act, hence there is a possibility that in such cases excess tax is deducted there is a possibility that in such cases excess tax is deducted relying on the provisions of the relevant DTAA. Since in these relying on the provisions of the relevant DTAA. Since in these cases, the resident deductor is put to genuine hardship, the cases, the resident deductor is put to genuine hardship, the Board has decided that the provisions of Circular No.7/2007 Board has decided that the provisions of Circular No.7/2007 dated 23.10.2007 shall also apply to those cases where dated 23.10.2007 shall also apply to those cases where deduction of tax at a higher rate under the relevant DTAA has deduction of tax at a higher rate under the relevant DTAA has been made while a lower rate is prescribed under the domestic been made while a lower rate is prescribed under the domestic law.law.

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Recent Circulars & Notifications: Recent Circulars & Notifications: contd.contd. CIRCULAR NO. 03 /2011dated the 13th May, 2011CIRCULAR NO. 03 /2011dated the 13th May, 2011

• Issuance of TDS Certificates in Form No. 16A downloaded Issuance of TDS Certificates in Form No. 16A downloaded from TIN Website and option to authenticate the same by from TIN Website and option to authenticate the same by way of digital signatureway of digital signature

• For deduction of tax at source made on or after For deduction of tax at source made on or after 01/04/2011:01/04/2011:Mandatory for all companies including Banking Companies & Mandatory for all companies including Banking Companies & Cooperative banks, to issue TDS certificates in Form No.16A Cooperative banks, to issue TDS certificates in Form No.16A generated through TIN central system and which is downloaded generated through TIN central system and which is downloaded from the TIN Website with a unique TDS certificate number.from the TIN Website with a unique TDS certificate number.For all other deductors , it is still optional to issue TDS For all other deductors , it is still optional to issue TDS certificates in Form No.16A generated through TIN central certificates in Form No.16A generated through TIN central system and which is downloaded from the TIN Website with a system and which is downloaded from the TIN Website with a unique TDS certificate number.unique TDS certificate number.The deductor, issuing TDS certificates in Form No.16A by The deductor, issuing TDS certificates in Form No.16A by downloading from the TIN Website shall authenticate such TDS downloading from the TIN Website shall authenticate such TDS certificate by either using digital signature or manual certificate by either using digital signature or manual signature.signature. Other deductors who do not issue the TDS Certificate in Form Other deductors who do not issue the TDS Certificate in Form No.16A by downloading from the TIN Website shall continue to No.16A by downloading from the TIN Website shall continue to authenticate TDS certificate in From No.16A by manual authenticate TDS certificate in From No.16A by manual signature only. signature only.

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Recent Circulars & Notifications:Recent Circulars & Notifications: contd contd..

• CIRCULAR NO. 05/2011 CIRCULAR NO. 05/2011 dated dated 16.08.2011 16.08.2011

• Master circular of TDS on SalariesMaster circular of TDS on Salaries

• ‘‘Dhamaka’Dhamaka’ inclusion inclusion““Further if annual rent paid by the employee Further if annual rent paid by the employee exceeds Rs 1,80,000 per annum, it is exceeds Rs 1,80,000 per annum, it is mandatory mandatory for the employee to report PAN for the employee to report PAN of the landlord to the employer. In case the of the landlord to the employer. In case the landlord does not have a PAN, a declaration landlord does not have a PAN, a declaration to this effect from the landlord along with to this effect from the landlord along with the name and address of the landlord should the name and address of the landlord should be filed by the employee”.be filed by the employee”.

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DECLARATION REGARDING PERMANENT DECLARATION REGARDING PERMANENT ACCOUNT NUMBERACCOUNT NUMBER

I,……………………………………………….(name of the landlord), I,……………………………………………….(name of the landlord), r/o…………………………. s/o…………………………… do hereby confirm r/o…………………………. s/o…………………………… do hereby confirm that I have given on rent property no………….that I have given on rent property no………….……………………………………………….to Mr/Ms (name of the tenant)……………………………………………….to Mr/Ms (name of the tenant)………………………..s/d/w/o………………….. ………………………..s/d/w/o………………….. r/o……………………………………. on a monthly rent of r/o……………………………………. on a monthly rent of Rs………………… w.e.f …………………Rs………………… w.e.f …………………I, further confirm that I do not hold any Permanent account Number I, further confirm that I do not hold any Permanent account Number (PAN) issued by the Income tax Department.(PAN) issued by the Income tax Department.The above information is true and correct to the best of my The above information is true and correct to the best of my knowledge and I shall be personally responsible and liable if the knowledge and I shall be personally responsible and liable if the same is found to be incorrect. Further I shall immediately furnish same is found to be incorrect. Further I shall immediately furnish the PAN if obtained by me subsequent to the signing of this the PAN if obtained by me subsequent to the signing of this declaration. declaration.

Signature Signature Name and Address:Name and Address:Nature of ID & its no. Nature of ID & its no. Place:Place:Date:Date:

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Recent Circulars & Notifications: Recent Circulars & Notifications: contd.contd. Income Tax Eighth Amendment Rules dated Income Tax Eighth Amendment Rules dated

24/10/201124/10/2011 • Any person other than deductee can claim TDS Any person other than deductee can claim TDS

credit if he is shown as deductee in TDS Returns credit if he is shown as deductee in TDS Returns as per declaration of deductee. {Rule 37BA(2)(i)}.as per declaration of deductee. {Rule 37BA(2)(i)}.

• It is now mandatory to show in TDS returns, It is now mandatory to show in TDS returns, particulars of deductee to whom amount particulars of deductee to whom amount has been paid without deduction of Tax due has been paid without deduction of Tax due to submission of Form 15G or Form 15H.to submission of Form 15G or Form 15H.{Rule 31A(4)(vii)}.{Rule 31A(4)(vii)}.

• Due date for filing of TDS returns of first three Due date for filing of TDS returns of first three quarters, by Government Deductors has been quarters, by Government Deductors has been extended by a fortnight. Now the due date is 31extended by a fortnight. Now the due date is 31stst July, 31July, 31stst October & 31 October & 31stst January for Qtr 1, 2 & 3 January for Qtr 1, 2 & 3 respectively. {Rule 31A(2)}.respectively. {Rule 31A(2)}.

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SOME JUDICIAL PRONOUNCEMENTSSOME JUDICIAL PRONOUNCEMENTS

Vipul Medcorp TPA Pvt Ltd & Ors v. CBDT (Delhi High Court) Vipul Medcorp TPA Pvt Ltd & Ors v. CBDT (Delhi High Court) (202 Taxman 463)(202 Taxman 463) . .- Third Party Administrators (TPAs) to deduct TDS u/s. 194J while - Third Party Administrators (TPAs) to deduct TDS u/s. 194J while making payment to hospital, No penalty u/s. 271C for non making payment to hospital, No penalty u/s. 271C for non deduction of TDS on TPAs. deduction of TDS on TPAs.

The High Court held that tax has to be deducted under Section The High Court held that tax has to be deducted under Section 194J of the Act if the payment is made to a resident person 194J of the Act if the payment is made to a resident person towards fees for professional services. Further, the nature of towards fees for professional services. Further, the nature of payment in the hands of the payee/recipient is relevant and that payment in the hands of the payee/recipient is relevant and that determines whether tax needs to be deducted or not. determines whether tax needs to be deducted or not. Section Section 194J of the Act does not specify that the payer must have 194J of the Act does not specify that the payer must have availed and taken benefit of the professional services. availed and taken benefit of the professional services. Therefore, it is not relevant whether the payer or a third Therefore, it is not relevant whether the payer or a third person has availed of the professional services.person has availed of the professional services. The High The High Court relying on the decision of Dedicated Health Care Services Court relying on the decision of Dedicated Health Care Services TPA (India) Private Limited held that tax needs to be deducted on TPA (India) Private Limited held that tax needs to be deducted on payments made to the recipient for rendering services in course of payments made to the recipient for rendering services in course of carrying on medical profession or other professions. It is carrying on medical profession or other professions. It is immaterial whether the recipient is an individual, firm or an immaterial whether the recipient is an individual, firm or an artificial person. The words ‘in the course of carrying on’ as artificial person. The words ‘in the course of carrying on’ as appearing in Explanation (a) to Section 194J of the Act do not appearing in Explanation (a) to Section 194J of the Act do not mean that the person who renders service must be a professional.mean that the person who renders service must be a professional.

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SOME JUDICIAL PRONOUNCEMENTS SOME JUDICIAL PRONOUNCEMENTS contd.contd. Sec 40(a)(ia)Sec 40(a)(ia)

The Kolkatta ITAT bench in The Kolkatta ITAT bench in Dy. CIT vs. S. K. TekriwalDy. CIT vs. S. K. Tekriwal has has held that there would be held that there would be no s. 40(a)(ia) disallowance for no s. 40(a)(ia) disallowance for “short-deduction of TDS” default.“short-deduction of TDS” default.

Sec 194JSec 194JThe Mumbai High Court in The Mumbai High Court in CIT vs. Kotak Securities Ltd.CIT vs. Kotak Securities Ltd. has held that has held that “Transaction charges” paid to BSE is “Transaction charges” paid to BSE is “fees for technical services” and TDS is deductible “fees for technical services” and TDS is deductible u/s 194-J.u/s 194-J.

Hindustan Coca cola Beverages P. LtdHindustan Coca cola Beverages P. Ltd [163 Taxman 355](SC) [163 Taxman 355](SC)The Supreme Court relying on Circular No. 275/201/95-IT(B) The Supreme Court relying on Circular No. 275/201/95-IT(B) dated 29-1-1997 agreed with the deductor that once the dated 29-1-1997 agreed with the deductor that once the deductee has paid the taxes, the Department cannot once deductee has paid the taxes, the Department cannot once again recover the tax from the deductor.again recover the tax from the deductor.

Madhumilan Syntex Ltd [290 ITR 199]Madhumilan Syntex Ltd [290 ITR 199]Held that a delayed payment of tax deducted at source Held that a delayed payment of tax deducted at source constitutes offence u/s 276B and hence liable to prosecutionconstitutes offence u/s 276B and hence liable to prosecution

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Some Public Utility Measures Some Public Utility Measures

Status of Quarterly TDS-TCS Statement Status of Quarterly TDS-TCS Statement now available by SMSnow available by SMS

• NSDL has started sending SMS for each NSDL has started sending SMS for each quarterly TDS/TCS statement processed at TIN. quarterly TDS/TCS statement processed at TIN. You just need to quote correct latest mobile You just need to quote correct latest mobile number in the quarterly TDS/TCS statement. number in the quarterly TDS/TCS statement. Status as below is provided in the SMS:Status as below is provided in the SMS:

• Accepted: This status is provided if the Accepted: This status is provided if the statement is accepted by TIN. statement is accepted by TIN.

• Rejected: This status is provided if the Rejected: This status is provided if the statement is rejected by TIN. statement is rejected by TIN.

• Partially accepted: This status is provided if the Partially accepted: This status is provided if the statement is partially accepted by TIN. statement is partially accepted by TIN.

• Complete details can we viewed under the Complete details can we viewed under the quarterly statement status view available at TIN quarterly statement status view available at TIN websitewebsite

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Some Public Utility MeasuresSome Public Utility Measures contd.contd.

Banks to send TDS Certificates to account holders Banks to send TDS Certificates to account holders

• ATAT a recent conference of Banking Ombudsman held in a recent conference of Banking Ombudsman held in RBI, it was decided, among others, that:- RBI, it was decided, among others, that:-

Banks should issue tax deduction at source (TDS) Banks should issue tax deduction at source (TDS) certificates duly completed in all respects to the certificates duly completed in all respects to the account holders and dispatch it to their mailing account holders and dispatch it to their mailing address. address.

New at NSDL websiteNew at NSDL website

• Now single verification in TAN login in a session for Now single verification in TAN login in a session for requesting consolidated TDS Return, Form 16A.requesting consolidated TDS Return, Form 16A.

• Download is now available from F.Y. 2005-06 onwards & Download is now available from F.Y. 2005-06 onwards & is now available for 30 days.is now available for 30 days.

• Now Request for Form 16A can be made for 10 PANs at Now Request for Form 16A can be made for 10 PANs at a time.a time.

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TDS MantraTDS Mantra

Whenever in Whenever in doubt, doubt, err on err on

Revenue side.Revenue side.

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DISCLAIMERDISCLAIMER

• Every effort has been made to avoid Every effort has been made to avoid any error or omission in making this any error or omission in making this presentation. In spite of this, some presentation. In spite of this, some lapse or error may creep in. Members lapse or error may creep in. Members are advised to cross check the relevant are advised to cross check the relevant provisions of law & government provisions of law & government notifications before relying upon this notifications before relying upon this presentation. Presenter carry no presentation. Presenter carry no responsibility whatsoever for any responsibility whatsoever for any inadvertent Lapse.inadvertent Lapse.

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THANK YOUTHANK YOU