TAN or Tax Deduction and Collection Number (TAN) is mandatory 10 digit alpha number required to be obtained by all persons who are responsible for Tax Deduction at Source (TDS) or Tax Collection at Source (TCS) on behalf of the Government. Tax deducted at source (TDS) ensures that the Government’s collection of tax is proponed and the responsibility for paying tax is diversified. The person deducting the tax at source is required to deposit the tax deducted to the credit of Central Government – quoting the TAN number. Individuals who are salaried are not required to obtain TAN or deduct tax at source. However, a proprietorship business who is eligible for tax audit and other entities (i.e., Private Limited Company, LLP, etc.,) must deduct tax at source while making certain payment like salary, payments to contractor or sub-contractors, payment of rent exceeding Rs.1,80,000 per year, etc. Advice House can help obtain TAN Registration.
Those entities have TAN Registration must then file TDS returns. TDS returns are due quarterly. Advice House can help you file e file your TDS returns online. Our TDS experts can help you compute your TDS payments and e file the TDS return and keep you in compliance with TDS regulations.
The due date for Payment of TDS deducted is seventh of the next month. For March, it is 30th April of the next year. The due date for TDS filing is as follows:
| Quarter | Period | Due Date |
| Q1 | 1st April – 30th June | On or before 31st July |
| Q2 | 1st July – 30th September | On or before 31st October |
| Q3 | 1st October – 31st December | On or before 31st January |
| Q4 | 1st January – 31st March | On or before 31st May |
Any person receiving payment for which tax has been deducted at source is required to obtain a valid PAN (if not obtained) and furnish the correct PAN to the deductor. Care must be taken to furnish the correct PAN, so that the tax deducted can be credited to correct account. Further, non-furnishing of PAN or furnishing of incorrect PAN would result in the deductor incurring higher TDS at 20% rate and levy of penalty of ten thousand rupees.
Hence, before furnishing PAN for TDS, the deductee must check the PAN status (Must be active) and number. PAN status and number can be checked through the Know Your PAN website of the Income Tax Department. Before furnishing the PAN ensure that it is in active state. If PAN status is inactive, then the deducted must contact the jurisdictional Assessing Officer to change PAN status to active.
On deducting TDS, the deductor would furnish to the deductee a TDS certificate. The deductee can cross check the tax credit by viewing Valid TDS certificate is the TDS certificate downloaded from TRACES (http://www.tdscpc.gov.in) bearing a 7 digit unique certificate number and TRACES watermark.
All TDS certificates must be preserved by the Deductee. TDS certificates on payments other than salary is issued on quarterly basis and TDS certificate for salary is provided on annual basis. If the TDS certificate is lost, the deductee can request for duplicate TDS certificate.
TDS credit can be claimed by the deductor. To claim the credit of TDS, the deductee has to mention the details of TDS in his return of income. Deductee should take due care to quote the correct TDS certificate number and TDS details while filing the return of income. If any incorrect detail is provided by the deductee, then tax credit discrepancy will arise at the time of processing the return of income and same can cause problem in processing the return of income.
There are different TDS Forms have been set depending on the income of the deductee or the type of deductee who pays the TDS. The different TDS forms are listed below as follows:
| S.No. | Form | Periodicity | Particulars |
| 1 | Form 24Q | Quarterly | Quarterly statement for TDS from “Salaries” |
| 2 | Form 26Q | Quarterly | Quarterly statement of TDS in respect of all payments other than “Salaries” |
| 3 | Form 27Q | Quarterly | Quarterly statement of TDS from interest, dividend or any other sum payments to non-residents |
| 4 | Form 27EQ | Quarterly | Quarterly statement of collection of tax at source |
According to Section 192 of the Income Tax Act 1961, an employer deducts TDS while paying salary to an employee. An employer has to file salary TDS return in Form 24Q, which has to be submitted on a quarterly basis. Details of the salary paid to the employees and the TDS deducted from the payment has to be specified in Form 24Q. In other words, Form 24Q is the quarterly statement of the payment made to the employee and the TDS deducted from it by the deductor.
When a taxpayer pays taxes, the payee deducts TDS on certain occasions. Form 26Q is used to file TDS details on payments made other than salary. The form mentions the total amount that is paid during the quarter and the TDS amount that has been deducted. Form 26Q has to be submitted on a quarterly basis.
Form 27Q is a TDS Return or Statement containing details of Tax Deducted at Source (TDS) deducted on payments other than salary made to Non-Resident Indian (NRI) and foreigners. Form 27Q is required to furnish on a quarterly basis on or before the due date. Form 27Q contains details of payments made and TDS deducted on payments made to NRI by the deductor.
Form 27EQ contains all details pertaining to tax that is collected at source. According to Section 206C of the Income Tax Act 1961, this form must be filed every quarter. The form has to be submitted by both the corporate and government collectors and deductors.
Form 26QB is a return-cum-challan form for the payment of Tax Deducted at Source (TDS) to the government for deductions made under Section 194-IA of the Income Tax Act, 1961. This section of the Act specifically deals with transactions involving the sale of immovable property and the applicable TDS along with Form 26QB needs to be submitted within 30 days counted from the end of the month in which TDS was deducted. For instance, if the transaction occurred on 14th March then Form 26QB must be mandatorily submitted by 30th April.
The Income Tax Act, 1961 has laid out a few key rules regarding sale and purchase of immovable property. In such transactions covered under Section 194-IA, the buyer, also known as the deductor, is required to deduct TDS if the transaction value is more than Rs. 50 lakhs. Subsequently, the deductor will required to issue Form 16B to the deductee (seller).
An individual or HUF paying rent of more than Rs 50,000 per month is now required to deduct tax at source (TDS) @ 5% on rental payments and to deposit it within the prescribed time.
Form 16C is a new TDS certificate introduced by the government of India. It reflects the amount of TDS deducted on rent @ 5% by the individual/HUF (u/s 194IB). It is just like Form 16 or Form 16A issued in the case of salary and other payments respectively. The person deducting the TDS on the rent is required to furnish Form 16C to the payee within 15 days from the due date of furnishing challan cum statement in Form 26QC.
For Instance, Ajay, who is a salaried employee is paying a rent of Rs 60,000 per month. He deducted the TDS @5% for the whole year in the month of March. The amount of TDS comes out to be Rs 36,000 (5%*7,20,000). Now this TDS should be deposited along with Form 26QC before 30th April, i.e. within 30 days from the end of the month in which TDS is deducted. Also, Ajay should furnish the Form 16C to the landlord before 15th May, i.e. within 15 days from the due date of furnishing challan cum statement in Form 26QC.
