When should TDS be deducted and by whom? Any person making specified payments mentioned under the Income Tax Act are required to deduct TDS at the time of making such specified payment. But no TDS has to deducted if the person making the payment is an individual or HUF whose books are not required to be audited.

What is the rule for TDS deduction?

If you have not filed your income tax returns for the last two years, and the total on your tax deductions exceeds Rs 50,000 or more in each of the preceding two years, you will be subject to a higher TDS. Now, this higher TDS can mean two things- either double the specified TDS rate or 5 percent, whichever is higher.

Is it mandatory to deduct TDS?

Yes, the deduction for TDS on salary is mandatory under Section 192 of the Income Tax Act. Every employer who pays a salaried income to his employees needs to deduct TDS on salary if the income amount is over the basic exemption limit.

Who is eligible for TDS exemption?

For the assessment year, 2020-2021 the exemption limit for an individual is Rs 2,50,000. Section 194B – TDS on winning from lottery, crossword or any game: A TDS of 30% is deducted from any amount received by the way of lottery, crosswords or any other game if the amount exceeds Rs. 10,000.

What if TDS is not deducted on salary?

Penalty for companies for not depositing or not deducting TDS on time. The employer can make the interest payment on such late payment of TDS before filing TDS returns or demand raised by TRACES. Also, the interest paid delay while depositing TDS is not allowed as an expense under the income tax provisions.

Liability to Deduct TDS by an Individual or HUF Enlarged - Finance Act, 2020

Is TDS is refundable?

TDS Refund – How to claim TDS Refund. Tax Deducted at Source (TDS) is the sum that is deducted from a taxpayer's income like salary, interest from bank accounts, rent etc. If the TDS collected is more than what you owe to the government, you can get a TDS Refund.

Who is not liable to deduct TDS?

Any person making specified payments mentioned under the Income Tax Act are required to deduct TDS at the time of making such specified payment. But no TDS has to deducted if the person making the payment is an individual or HUF whose books are not required to be audited.

Who is liable to deduct TDS under GST?

TDS Certificate: A TDS certificate is required to be issued by deductor (the person who is deducting tax) in Form GSTR-7A to the deductee (the supplier from whose payment TDS is deducted), within 5 days of crediting the amount to the Government, failing which the deductor would be liable to pay a late fee of Rs.

Who is liable to deduct TDS on professional fees?

Every person, who is making a payment in the nature of fees for professional or technical services is liable to deduct tax at source with the following exceptions: In case of an individual or HUF carrying on business: Where his turnover does not exceed Rs. 1 crore during the previous financial year..

Who is liable for GST?

Generally, the supplier of goods or services is liable to pay GST. However, in specified cases like imports and other notified supplies, the liability may be cast on the recipient under the reverse charge mechanism.

Who is liable to deduct TCS?

Tax collected at source (TCS) is the tax payable by a seller which he collects from the buyer at the time of sale. Section 206C of the Income-tax act governs the goods on which the seller has to collect tax from the purchasers.

What is TDS and its rules?

TDS stands for tax deducted at source. As per the Income Tax Act, any company or person making a payment is required to deduct tax at the source if the payment exceeds certain threshold limits. ... It is the deductor's responsibility to deduct TDS before making the payment and deposit the same with the government.

Who files gstr7?

GSTR-7 is a monthly return to be filed by the persons required to deduct Tax Deducted at Source (TDS) under the Goods and Services Tax (GST). Every GST registered person required to deduct TDS under GST shall furnish a return in Form GSTR-7 by the 10th of next month.

Why do we deduct TDS?

The concept of TDS was introduced with an aim to collect tax from the very source of income. As per this concept, a person (deductor) who is liable to make payment of specified nature to any other person (deductee) shall deduct tax at source and remit the same into the account of the Central Government.

Can we deduct TDS on GST?

For the purpose of deduction of TDS, the value of supply is to be taken as the amount excluding the tax indicated on the invoice. This means TDS shall not be deducted on the CGST, SGST or IGST component of invoice. ... So it can be said that TDS is not deducted on the tax element (GST) of a transaction.

Who can deduct TDS u/s 51?

Section 51 of the CGST Act 2017 provides for deduction of tax by the Government Agencies (Deductor) or any other person to be notified in this regard, from the payment made or credited to the supplier (Deductee) of taxable goods or services or both, where the total value of such supply, under a contract, exceeds two ...

Who is liable for advance tax?

As per section 208 of the Income Tax Act 1961, every person whose estimated tax liability for the year is more than or equal to `10,000 is liable to pay advance tax. Those who are excluded from paying advance tax are senior citizens who are above the age of 60, not having any income from business or profession.

Who is liable to deduct TDS under 194A?

Every person (i.e. the payer) other than an individual or a Hindu undivided family (HUF), who is responsible to pay interest (interest other than on securities) to a resident, is liable to deduct tax at source under section 194A.

How can I check my TDS deduction?

1. Step 1: Go to
2. Step 2: Register and Login to the portal.
3. Step 3: Go to 'My Account' tab and click on view Form 26AS (Tax Credit)
4. Step 4: Select year and PDF format to download the file and proceed further.
5. Step 5: Open the downloaded file.

How We Can Save TDS on salary?

1. It is mandatory to deduct TDS on salary if the employee's income exceeds the exempt tax limit. ...
2. Under Section 80C and 80D, the government allows tax exemptions, where a taxpayer can claim an exemption based on his/her various investments in that financial year.

How can I check my TDS status?

1. Visit
2. Key-in the verification code.
3. Click on 'Proceed'
4. Enter the PAN and TAN.
5. Select the financial year as well as the quarter and the type of return.
6. Click on 'Go'
7. The details will be displayed on the corresponding screen.