TAX DEDUCTION/ COLLECTION AT SOURCETAX DEDUCTION/ COLLECTION AT SOURCE

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RELEVANCE OF TDSRELEVANCE OF TDS

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TDS/ TCS WORK FLOWTDS/ TCS WORK FLOW

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WORK FLOW OF e-FILING OF STATEMENTS WORK FLOW OF e-FILING OF STATEMENTS (prior to CPC TDS)(prior to CPC TDS)

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WORK FLOW OF e-FILING OF STATEMENTS WORK FLOW OF e-FILING OF STATEMENTS (post CPC TDS)(post CPC TDS)

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Taxpayer Deductor

BanksBanks

Advance Tax,SA Tax TDS Deposit

OLTASOLTAS

e-TDS statement

AST/CPC-Bengaluru

e-filed Income tax Returns

DEDUTORS PORTAL

26AS VIEW -

TAXPAYERSAO portal

Tax Credits

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CPC (TDS): Game ChangerCPC (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. - Taxpayers will have the convenience of viewing 26AS on a real-time basis and real-time support for clarifications. - Field AOs will be enabled to ensure enforcement and compliance through online Ticket Management System.

CPC (TDS) for DeductorsCPC (TDS) for Deductors

TRACES: https://www.tdscpc.gov.in

Dashboard

- Statement Status and Default payable

- 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 TDS Compliance Report

Non - Resident Taxpayer Registration

e-Tutorials and FAQs

Circular and Notifications

CPC (TDS) Communications        

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Deductor Functionalities in TRACES

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Deductor’s DashboardDeductor’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 DashboardDeductor Dashboard

Statement/ Payment StatusStatement/ Payment Status

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Back

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View Default SummaryView Default Summary

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View Default SummaryView Default Summary

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Aggregated TDS Compliance Aggregated TDS Compliance ReportReport

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.)Aggregated TDS Compliance Request (Contd.)

Select ; Aggregated

TDS Compliance

Copyright © 2012 Income Tax Department 18

Click on ‘View All’ to view all

download requests

Enter Request Number (Search Option 1) or

Request Date (Search Option 2

Aggregated TDS Compliance Request (Contd.)Aggregated TDS Compliance Request (Contd.)

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Online Corrections FunctionalityOnline 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

Online CorrectionsOnline 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

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PAN AND CHALLAN CORRECTION BY PAN AND CHALLAN CORRECTION BY DEDUCTORDEDUCTOR

New functionality Utility

PAN Correction mechanism introduced at the deductor portal of TRACES

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 othersUnmatched 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

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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

Back

Back 27

Back

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RECENT COMMUNICATION FROM CPCRECENT COMMUNICATION FROM CPC

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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. 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 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

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.

COMMON ISSUES PERTAINING TO TRACES COMMON ISSUES PERTAINING TO TRACES FACED BY DEDUCTORSFACED BY DEDUCTORS

Rejection of correction statementsRefund197 certificate verificationDemand pertaining to interestCorrection statements pertaining to paper

statements of F.Y. 07-08Cancellation of statement facilityCancellation of TAN facilityProblems relating to 16BProblem in downloading conso file Intimation u/s 200A issues

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REJECTION OF CORRECTION REJECTION OF CORRECTION STATEMENTSSTATEMENTSProbable Reasons for

rejectionSolution

Sequence of challan / salary/ deductee detail record being added in a correction statement is not in continuation of the last sequence number for the said record in the original statement.

Add deductee row in sequence to the preceding row in the conso file followed by filing of the corrected statement

Deductor may have changed the field which are not updatable fields by Mistake

Deductor should not make any changes in non updatable fields

Deductor has not used latest conso file for filling correction statement

Use the latest conso file

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Probable Reasons for rejection

Solution

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.

Check the PAN from PAN verification at TRACES portal before making the PAN correction

If deductor submit a correction statement to update existing matched / partially matched challan with updates on one or more of fields other than the following. a) Interest, b)Others and c)Section Code.Change in any other field will lead to rejection of the correction statement.

Deductor should not make any changes in any field of BOOKED Challan except Interest,Others & Section Code

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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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REJECTION OF CORRECTION REJECTION OF CORRECTION STATEMENTSSTATEMENTS

Problems faced by the deductors

Reasons and Solution

Challan not getting corrected in a reasonable period of time

Issue taken up with CPC

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OLTAS CHALLAN CORRECTION VIA BANK/ OLTAS CHALLAN CORRECTION VIA BANK/ AOAO

REFUND THROUGH DEDUCTOR PORTALREFUND THROUGH DEDUCTOR PORTAL

New functionality Utility

Claim of refund in case of excess payments through the deductor portal of TRACES(Digital signature required)

Deductor can apply for refund onlineNo direct interface with field AOThe refund will be issued by TDS CPC only fter making certain verifications from field AOField AO- CPC TDS interface yet to be established in this regard

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197 CERTIFICATE VERIFICATION197 CERTIFICATE VERIFICATION

New functionality Utility

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

Short deduction demand pertaining to low deduction certificate can be resolved by using this functionality

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DEMAND PERTAINING TO INTERESTDEMAND 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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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 30th Nov and paid on 9th Dec, interest has to be paid for two months.

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DEMAND PERTAINING TO INTERESTDEMAND PERTAINING TO INTEREST

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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DEMAND PERTAINING TO PAN STATUSDEMAND PERTAINING TO PAN STATUS

CORRECTION STATEMENTS PERTAINING CORRECTION STATEMENTS PERTAINING TO PAPER STATEMENTS OF F.Y. 2007-08TO PAPER STATEMENTS OF F.Y. 2007-08

Problem Reason/ Solution

• Deductor is not able to file correction statements pertaining to paper statements pertaining to F.Y. 2007-08

The correction statement can be filed in paper format only as new statement after cancelling the original statement.

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CANCELLATION OF STATEMENTS CANCELLATION OF STATEMENTS FACILITYFACILITY

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 FACILITYCANCELLATION 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 16BPROBLEMS 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

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PROBLEM IN DOWNLOADING CONSO PROBLEM IN DOWNLOADING CONSO FILEFILE

Problem Reason/ Solution

• Deductor is not having the mandatory detail of at least one Challan and three PANs, in order to download conso file

No alternative remedy as per law as of now.

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Intimations u/s 200A-IssuesIntimations u/s 200A-Issues

Issue Advisory

Paid the demand raised for late payment fee u/s 234E

File a correction statement after adding the payment challan w/o any deductee rows.

Requested for the waiver of Fee levied u/s 234E

Cannot be waived off as it is a statutory levy

Wrong TAN in OLTAS challan leading to Short Payment.

Jurisdictional AO to raise request for challan correction through AO Portal

Paid the demand raised in the intimation u/s 200A

File correction statement for closing defaults.

Details of the defaults not appearing in the intimation u/s 200A

Download a Justification Report from the TRACES website.

Short deduction default in a 197 certificate case or transporter case

Verify relevant flags in the statement

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1.1.

How to avoid Defaults in TDS Statements?How to avoid Defaults in TDS Statements?

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1.1.

Late Payment: Late Payment:

DO’SDO’S

1. Tax should be deposited within seven days from the end of the month in which the deduction is 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 .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.2. Date of Deduction and Date of payment should be correctly filled.

3. Book Entry Flag should be raised according to type of Deductor.3. Book Entry Flag should be raised according to type of Deductor.

DONT’SDONT’S

1. Date of deduction should not be Null 1. Date of deduction should not be Null

2. Date of Payment/credit 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.3. Date of Deduction should not be before the date of payment /credit.

4. No Book Entry allowed for Non-Govt. Deductor.4. No Book Entry allowed for Non-Govt. Deductor.

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LateLate FilingFiling::

DO’SDO’S

1. Quarterly Statement should be filed within due date prescribed by 1. Quarterly Statement should be filed within due date prescribed by

Income Tax under rule 31 A.Income Tax under rule 31 A.

2. Select correct deductor type category while filing statement.2. Select correct deductor type category while filing statement.

DONT’SDONT’S

1. Don’t delay in filing regular statement.1. Don’t delay in filing regular statement.

2. Don’t select wrong deductor type category while filing statement.2. Don’t select wrong deductor type category while filing statement.

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ShortShort DeductionDeduction::

DO’SDO’S

1. Deducts TDS according to section rate prescribed in Income Tax Act.1. Deducts TDS according to section rate prescribed in Income Tax Act.

2. Quote valid PAN while filing statement.2. Quote valid PAN while filing statement.

3. Appropriate flag should be raised as given below: 3. Appropriate flag should be raised as given below:

A-Lower/No Deduction for Certificate A-Lower/No Deduction for Certificate

B-Higher Deduction where PAN is not available.B-Higher Deduction where PAN is not available.

C-Higher Deduction where PAN is not available C-Higher Deduction where PAN is not available

T-No Deduction for Transporters having PANT-No Deduction for Transporters having PAN

Y- No deduction due to payment below threshold limit. Y- No deduction due to payment below threshold limit.

4. Quote Certificate No. issued by ITD for relevant TAN –PAN Combination, 4. Quote Certificate No. issued by ITD for relevant TAN –PAN Combination,

F.Y, Quarter and periodicity. F.Y, Quarter and periodicity.

5. Proper slab rate should be use according to deductee type for calculation of 5. Proper slab rate should be use according to deductee type for calculation of

income tax in case of salary.income tax in case of salary.

6. Certificate no. should be of 10 digits with alpha numeric structure.6. Certificate no. should be of 10 digits with alpha numeric structure. 49

Short Short Deduction:Deduction:

DONT’SDONT’S

1. Don’t deduct with wrong section rate.1. Don’t deduct with wrong section rate.

2. Don’t quote invalid PAN in statement..2. Don’t quote invalid PAN in statement..

3. Don’t Raise Flag A for PAN which do not have 197 certificate.3. Don’t Raise Flag A for PAN which do not have 197 certificate.

4. Don’t mentioned incomplete certificate number.4. Don’t mentioned incomplete certificate number.

5. Don’t use expired certificate.5. Don’t use expired certificate.

6. Don’t use wrong Income Tax Slab.6. Don’t use wrong Income Tax Slab. 

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ShortShort PaymentPayment::

DO’SDO’S

1. Deducted/Collected amount should be equal to deposited amount.1. Deducted/Collected amount should be equal to deposited amount.

2. Oltas Available Balance should be equal or more than deducted /collected 2. Oltas Available Balance should be equal or more than deducted /collected

amount.amount.

3. Oltas challan should be matched with statement Challan after applying 3. Oltas challan should be matched with statement Challan after applying

matching rules.matching rules.

4. Govt. Deductor needs to raise Book Entry Flag “Y” in case of BIN.4. Govt. Deductor needs to raise Book Entry Flag “Y” in case of BIN.

DONT’SDONT’S

2. Available Oltas Balance should not be less than deducted/collected 2. Available Oltas Balance should not be less than deducted/collected

amount.amount.

3. Challan details as per statement should not mismatch with Oltas Challan 3. Challan details as per statement should not mismatch with Oltas Challan

Details after applying matching rules.Details after applying matching rules.

4. Don’t raise wrong book entry flag in statement .4. Don’t raise wrong book entry flag in statement .  51

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