Transcript Deductors
TAX DEDUCTION/ COLLECTION AT SOURCE
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Govt makes welfare schemes
RELEVANCE OF TDS
Forecasts revenue for a year (Borrowings/ taxes) Effective implementation of schemes Round the year fund flow ensures effective funding of schemes TDS deposited every month ensures circulation of money 2
TDS/ TCS WORK FLOW
Obtain TAN Deduct/ collect taxes from liable payments (at the time of payment/ receipt or, at the time of debiting/ crediting the books) at prescribed rates Deposit TDS/ TCS (Challan 281) within the prescribed time limit File quarterly statements (24Q, 26Q, 27EQ) withinn the prescribed time limit in the prescribed manner Issue TDS/ TCS certificates within the prescribed time limit 3
WORK FLOW OF e-FILING OF STATEMENTS (prior to CPC TDS)
Deductor deducts/ collects tax Deductor pays tax Preparation of e statement and submitting it at TIN-FC in e format Processing of statement by NSDL Intimation generated by I.T.Department
Uploading of statements to NSDL Correction statement filed at TIN FC, followed by processing at NSDL Uploading of statement to agency of NSDL 26AS generated followed by processing 4
WORK FLOW OF e-FILING OF STATEMENTS (post CPC TDS)
Deductor deducts/ collects tax Deductor pays tax Preparation of e statement and submitting it at TIN-FC in e format Uploading of statement to agency of NSDL Intimation generated by I. T. Department Processing of statement by CPC TDS Transfer of statement to CPC TDC Correction statement filed at TIN FC, followed by transfer of statement to CPC TDS Processing of correction statement by CPC TDS 26AS generated followed by processing Uploading of statements to NSDL 5
Taxpayer Advance Tax,SA Tax Banks Deductor TDS Deposit e-TDS statement e-filed Income tax Returns OLTAS TIN-FC AST/CPC-Bengaluru Tax Credits • Matching of Challans • Generation of PAN ledgers
CPC-TDS
• Identification of defaults • Portal,DMS,BI, Other DEDUTORS PORTAL 26AS VIEW TAXPAYERS AO portal 6
CPC (TDS): Game Changer
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Deductors
will get benefitted by non intrusive integrated online services related to Statement/ Challan processing status, Default information, TDS certificates and real-time support for clarifications.
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Taxpayers
will have the convenience of viewing 26AS on a real-time basis and real-time support for clarifications.
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Field AOs
will be enabled to ensure enforcement and compliance through online Ticket Management System.
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CPC (TDS) for Deductors
TRACES: https://www.tdscpc.gov.in
Dashboard
Statement payable Status and Default Deductor Compliance Profile
Online Corrections
View Defaults Summary
Online PAN Verification
Statement and Challan Status
TAN – PAN Consolidated File
Downloads
TDS Certificates Form 16/ 16A Form 16B Form 27D Transaction Based Report for Non - Residents Consolidated Statement File Justification Reports
Aggregated Report TDS Compliance
Non - Resident Taxpayer Registration
e-Tutorials and FAQs
Circular and Notifications
CPC (TDS) Communications
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Deductor Functionalities in TRACES
Statement Status Challan Status View TDS/TCS Credit PAN Verification Justification report Download Forms Validation of 197 Certificate Non Filing of Statement Request for Resolution Tag Replace Challan
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Deductor’s Dashboard
• • • Deductor’s Dashboard displays important information at one screen. The following information can be viewed by the deductor in its dashboard: Statement Status: Processing status of the Statements of last four quarter along with Default Summary.
Communication Inbox: - To view the recent communication made between TRACES and Deductor. This also facilitates the downloading of Intimations sent to the deductor.
Summary of recent activity by the deductor.
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Deductor Dashboard
Statement/ Payment Status
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View Default Summary
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View Default Summary
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Aggregated TDS Compliance Report
An entity level PAN associated with more that one TANs, for example PAN of the Central Office, Headquarter etc., having more that one TANs for its branches, can review the "Aggregated TDS Compliance" report on a regular basis to improve TDS compliance at Organization level. The feature assists in effective TDS administration, monitoring, control and compliance at Organization level. While conducting Audits, the above feature can be used for the purpose of identifying Defaults in respect of all TANs associated with the entity level PAN.
The feature will be extremely useful for the purpose of complying with the provisions of Section 40(a)(ia) of the Income Tax Act, 1961 by the concerned entity, to ensure that correct information is disclosed in paragraph 27 A & B of the Tax Audit Report (Form 3CD) u/s 44AB of the Act.
Functionality available for Financial Year 2007-08 onwards.
The download of the list of defaults of various TANs associated with a PAN will be available in Excel Format for which a request has to be placed.
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Aggregated TDS Compliance Request (Contd.)
Select ; Aggregated TDS Compliance 17
Aggregated TDS Compliance Request (Contd.)
Click on ‘View All’ to view all download requests Enter Request Number (Search Option 1) or Request Date (Search Option 2 Copyright © 2012 Income Tax Department 18
Online Corrections Functionality
Important Facts:
•Statements for Financial Year 2012-13 onwards only will be available for Online Corrections.
•Digital Signature is mandatory for all type of Online Corrections, except for Challan Corrections.
•The following actions can be performed with Online Corrections: • Tag Unmatched Challans • Corrections for Overbooked Challan – movement of Deductee Rows • Modify/ Add Deductee details • PAN Correction • Update Personal Information • Pay 220, Interest, Levy for Late filing 19
Online Corrections
This feature enables the Deductor to file Online Correction statements through TRACES portal without downloading TDS/TCS Consolidated File. Apart from the currently available facilities for PAN Correction and Challan Correction. Following facilities are to be allowed PAN Correction Challan Correction Add challan to statement Modify/Add deductee row Modify Salary details Pay 220I, Late Payment, Late Deduction and Late Filing Interest Update of Personal Information Movement of Deductee Rows 20
PAN AND CHALLAN CORRECTION BY DEDUCTOR
New functionality
PAN Correction mechanism introduced at the deductor portal of TRACES
Utility
Deductor will not have to go through the tedious process of filing correction statement, by downloading conso file in case only PAN needs to be corrected. Challan correction mechanism introduced at the deductor portal of TRACES Matched challans can be corrected to the extent of section, amount of interest and others Unmatched challans can also be consumed now.
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Download Form 16
• • • • Data in Form 16 will be as per latest statement processed (Form 24Q ) for selected FY & Quarter Download request for Form 16 for a particular FY can be submitted only after Form 24Q statement for Q4 for the selected FY is filed by deductor and processed by TDS CPC. Statement filed should not have been cancelled or NIL Statement.
Form 16 can be downloaded from FY 2007-08 onwards For a given FY, TAN and PAN, there will be only one Form 16. In case of more than one employer, a PAN holder can have those many Form 16s 24
Justification Report
Click on Help icon for help text for this screen • • Select Financial Year, Quarter and Form Type for which Justification Report is required and click on ‘Go’ Validation screen will be presented on click of ‘Go' Request for Justification Report can be submitted only if: Selected statement has been not filed as paper return 25
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Show Cause Notice u/s 201 functionality is available on AO portal Functionality for creating and viewing Quality Cases and Awareness Programs is available on AO Portal under menu 'Quality Cases'. TDR functionality has been introduced under TDR menu. Consolidated demand can be seen for any deductor using Consolidated demand under View Menu. is available under "Default Summary" options in "View" menu. AOs may initiate the recovery proceedings. OLTAS Challan correction requests for change from valid TAN1 to valid TAN2 will be sent for approval to the Jurisdictional Assessing Officer of valid TAN1 Deductor can file Online Correction on our website www.tdscpc.gov.in
for Challan Correction and PAN error MIS report for defaults is now available for Field CsIT. Please use the same for recovery proceedings. Drilldown dashboards are available for the FAO's AO can now Upload more than 50 Demands at once using Bulk Upload functionality Buyer of immovable property can download Form 16B after registering on TRACES as The MIS report "Defaulters" showing the TAN wise demand details is available to CsIT (TDS) & Range Heads. The demand for different TANs under the jurisdiction of an AO Tax Payer TDS is now applicable on sale of immoveable property In case of short deduction due to PAN error, demand will be reduced after processing the correction statement, only if the new PAN is Valid and difference between new and old PAN is not more than two alphabates and two numerals. For any type of correction in challan, Jurisdictional Assessing Officer can raise a ticket. Please do not send any assessee to CPC Levy u/s 234E of the Income Tax Act, 1961 is a statutory levy and cannot be waived off. Do not send any communication in this regard In order to close the demand, please advise deductors to file correction statement after paying the demand through challan Challans for FY 2011-12 available for force matching with statements of FY 2011-12. 29
COMMON ISSUES PERTAINING TO TRACES FACED BY DEDUCTORS
Rejection of correction statements Refund 197 certificate verification Demand pertaining to interest Correction statements pertaining to paper statements of F.Y. 07-08 Cancellation of statement facility Cancellation of TAN facility Problems relating to 16B Problem in downloading conso file Intimation u/s 200A issues
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REJECTION OF CORRECTION STATEMENTS
Probable Reasons for rejection
Sequence of challan / salary/ deductee detail record being added in a correction statement is not in continuation sequence number for the said record in of the the last original statement.
Deductor may have changed the field which are not updatable fields by Mistake Deductor has not used latest conso file for filling correction statement
Solution
Add deductee row in sequence to the preceding row in the conso file followed by filing of the corrected statement Deductor should not make any changes in non updatable fields Use the latest conso file 31
Probable Reasons for rejection
Valid to Valid PAN correction can be done only Once. The statement is rejected, since Deductor has already filed one Valid to Valid PAN correction before the present correction statement.
If deductor submit a correction statement a) Interest, b)Others and statement.
to c)Section Code.
update existing matched / partially matched challan with updates on one or more of fields other than the following.
Change in any other field will lead to rejection of the correction
Solution
Check the PAN from PAN verification at TRACES portal before making the PAN correction Deductor should not make any changes in any field of BOOKED Challan except Interest,Others & Section Code 32
REJECTION OF CORRECTION STATEMENTS
Probable Reasons for rejection Solution
Total Challan Amount is less than the sum of TDS + Interest + Others Amount Deductor should not quote the amount more than the available balance in the correction statement.
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OLTAS CHALLAN CORRECTION VIA BANK/ AO
Problems faced by the deductors
Challan not getting corrected in a reasonable period of time
Reasons and Solution
Issue taken up with CPC 34
REFUND THROUGH DEDUCTOR PORTAL
New functionality
Claim of refund in case of excess payments through the deductor portal of TRACES (Digital signature required)
Utility
Deductor can apply for refund online No direct interface with field AO The refund will be issued by TDS CPC only fter making certain verifications from field AO Field AO- CPC TDS interface yet to be established in this regard 35
197 CERTIFICATE VERIFICATION
New functionality
Deductor can verify the details/ validity of the low deduction certificate u/s 197 of the Act before filing the statement by the deductor portal of the TRACES
Utility
Short deduction demand pertaining to low deduction certificate can be resolved by using this functionality 36
DEMAND PERTAINING TO INTEREST
Problem Solution
• Deductor gets short deduction notices for default in interest payment. Payment made, correction statement filed, but still get a short deduction notice.
The amount of interest mentioned in the notice/ intimation is provisional (as on the date of processsing).The deductor needs to recompute interest at the time of making payment/ filing statement for correct compliance.
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DEMAND PERTAINING TO INTEREST
Problem Solution
• Deductor gets short deduction notices for default in interest payment. Deductor complaints that though interest has been computed correctly, he/ she is getting notice/ intimation.
The period for computing interest should be calculated from the date of tax dedution till payment made (and not from the due date of payment). E.g., if TDS is deducted on 30 th Nov and paid on 9 th Dec, interest has to be paid for two months.
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DEMAND PERTAINING TO PAN STATUS
Problem Reason/ Solution
• Deductor gets short deduction notice with justification that the deduction u/s 194C has been done @1%, instead of @2%. The deductee is not an Individual or HUF.
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CORRECTION STATEMENTS PERTAINING TO PAPER STATEMENTS OF F.Y. 2007-08
Problem
• Deductor is not able to file correction statements pertaining to paper statements pertaining to F.Y. 2007-08
Reason/ Solution
The correction statement can be filed in paper format only as new statement after cancelling the original statement. 40
CANCELLATION OF STATEMENTS FACILITY
Problem Reason/ Solution
• A deductor while filing a statement quotes wrong TAN. The deductor whose TAN was quoted is not able to file the statement as the system reads “original statement already filed”. The deductor cannot even file the correction statement in absence of data. Hence, justification for “cancellation of statement” facility.
The cancellation of statement functionality was withdrawn few years back because of its misuse. The issue is being taken up with CPC TDS.
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CANCELLATION OF TAN FACILITY
Problem Reason/ Solution
• A deductor stops using a TAN and wants to cancel it as it keeps on getting “non filer notices” from the department.
The TAN can be made inactive through ITD system.
The TAN cannot be cancelled because the deductor’s statements can be scrutinised till six years. Any default detected later may create complications.
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PROBLEMS RELATING TO 16B
Problem Reason/ Solution
• Seller not getting the credit (zero credit) in form 16B.
The Deductor (Buyer) should fill the amount of tax in 'TDS Amount to be Paid' field and not in 'Interest' or 'Fee' field. Else, the seller will not get the credit of such tax 43
PROBLEM IN DOWNLOADING CONSO FILE
Problem
• Deductor is not having the mandatory detail of at least one Challan and three PANs, in order to download conso file
Reason/ Solution
No alternative remedy as per law as of now.
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Intimations u/s 200A-Issues
Issue
Paid the demand raised for late payment fee u/s 234E Requested for the waiver of Fee levied u/s 234E Wrong TAN in OLTAS challan leading to Short Payment.
Paid the demand raised in the intimation u/s 200A Details of the defaults not appearing in the intimation u/s 200A Short deduction default in a 197 certificate case or transporter case
Advisory
File a correction statement after adding the payment challan w/o any deductee rows.
Cannot be waived off as it is a statutory levy Jurisdictional AO to raise request for challan correction through AO Portal File correction statement for closing defaults.
Download a Justification Report from the TRACES website.
Verify relevant flags in the statement 45
How to avoid Defaults in TDS Statements?
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Late Payment:
DO’S 1. Tax should be deposited within seven days from the end of the month in which the deduction is made or income-tax is due, where tax is paid accompanied by an income- tax challan .
2. Date of Deduction and Date of payment should be correctly filled.
3. Book Entry Flag should be raised according to type of Deductor.
DONT’S 1. Date of deduction should not be Null 2. Date of Payment/credit should not be Null.
3. Date of Deduction should not be before the date of payment /credit.
4. No Book Entry allowed for Non-Govt. Deductor.
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Late Filing
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DO’S 1. Quarterly Statement should be filed within due date prescribed by Income Tax under rule 31 A.
2. Select correct deductor type category while filing statement.
DONT’S 1. Don’t delay in filing regular statement.
2. Don’t select wrong deductor type category while filing statement.
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Short Deduction
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DO’S 1. Deducts TDS according to section rate prescribed in Income Tax Act.
2. Quote valid PAN while filing statement.
3. Appropriate flag should be raised as given below: A-Lower/No Deduction for Certificate B-Higher Deduction where PAN is not available.
C-Higher Deduction where PAN is not available T-No Deduction for Transporters having PAN Y- No deduction due to payment below threshold limit. 4. Quote Certificate No. issued by ITD for relevant TAN –PAN Combination, F.Y, Quarter and periodicity. 5. Proper slab rate should be use according to deductee type for calculation of income tax in case of salary.
6. Certificate no. should be of 10 digits with alpha numeric structure.
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Short Deduction:
DONT’S 1. Don’t deduct with wrong section rate.
2. Don’t quote invalid PAN in statement..
3. Don’t Raise Flag A for PAN which do not have 197 certificate.
4. Don’t mentioned incomplete certificate number.
5. Don’t use expired certificate.
6. Don’t use wrong Income Tax Slab.
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Short Payment
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DO’S 1. Deducted/Collected amount should be equal to deposited amount.
2. Oltas Available Balance should be equal or more than deducted /collected amount.
3. Oltas challan should be matched with statement Challan after applying matching rules.
4. Govt. Deductor needs to raise Book Entry Flag “Y” in case of BIN.
DONT’S 2. Available Oltas Balance should not be less than deducted/collected amount.
3. Challan details as per statement should not mismatch with Oltas Challan Details after applying matching rules.
4. Don’t raise wrong book entry flag in statement .
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