FAQ: Frequently Asked Questions
FAQ-01: How can I know the quantum of tax deducted from my income by the payer?
To know the quantum of the tax deducted by the payer, you can ask the payer to furnish you a TDS certificate in respect of tax deducted by him.
You can also check Form 26AS from your e-filing account at https://incometaxindiaefiling.gov.in, or
Through “View Your Tax Credit” facility available at http://www.incometaxindia.gov.in
FAQ-02: What to do if the TDS credit is not reflected in Form 26AS?
Non-reflection of TDS credit in Form 26AS can be due to several reasons like non-filing of TDS statement by the payer, quoting incorrect PAN of the deductee (or some inconsistency / error) in the TDS statement filed by the payer. In case of non-reflection of TDS credit in Form 26AS, the payee has to contact the payer for ascertaining the correct reasons for non-reflection of the TDS credit in Form 26AS.
FAQ-03: I have not received TDS certificate from the deductor. Can I claim TDS in my return of income?
Yes, the tax credit in your case will be reflected in your Form 26AS and, hence, you can check Form 26AS and claim the credit of the tax accordingly. However, the claim of TDS to be made in your return of income should be strictly as per the TDS credit being reflected in Form 26AS. If there is any discrepancy in the tax actually deducted and the tax credit being reflected in Form 26AS then you should intimate the same to the deductor and should reconcile the difference. The credit granted by the Income-tax Department will be as per Form 26AS.
FAQ-04: What is the difference between PAN and TAN?
PAN stands for Permanent Account Number and TAN stands for Tax Deduction Account Number. TAN is to be obtained by the person responsible to deduct tax, i.e., the deductor. In all the documents relating to TDS and all the correspondence with the Income-tax Department relating to TDS one has to quote his TAN.
PAN cannot be used for TAN, hence, the deductor has to obtain TAN, even if he holds PAN.
However, in case of TDS on purchase of land and building (as per section 194IA), the deductor is not required to obtain TAN and can use PAN for remitting the TDS.
FAQ-05 : What is the difference between TDS and TCS?
TDS is Tax Deducted at Source (on payment made for Expense) and TCS is Tax Collected at Source (on Income Received).
FAQ-06 : How TDS U/S 194B is deducted in case where gift / prize by way of winnings from lottery is given in kind?
- Part Cash / Part Kind : If prize is given partly in cash and partly in kind- Tax will be deducted from cash prize with reference to the aggregate amount of the cash prize and the value of price in kind. And where in the part of cash is not sufficient to meet the liability for tax deduction in respect of whole of the winnings then payer has to collect the balance from the payee.
- In Kind only : Where the prize is wholly in kind, The payer has to collect the liability for tax deduction from payee.
Example – Mr.” X “wins a Maruti-Zen value of Rs.3,70,000. Tax liability on prize in kind comes to Rs.1,14,330 (30.9% of Rs.3,70,000) which may be recovered by the Maruti Udyog from Mr. “X” and the same can be deposited with the government on account of TDS.
FAQ-07 : Whether TDS U/S 194J is to be made inclusive of reimbursement of expenditure or exclusive?
TDS on reimbursement is not required to be made if separate bills are raised one is for professional fee and the other is for reimbursement of expenditure. If a single bill is raised for the professional fee inclusive of reimbursement of expenditure, in such a case TDS is to be made on gross amount
FAQ-08: What is the Difference between Form-15G and Form-15H?
Form-15G: It is declaration given by an individual or other person (not being a company or firm), not to deduct tax, where the total income including the current receipts will not exceed the maximum amount which is not chargeable to income tax.
Form-15H: It is declaration given by an individual who is the age of 60 years or more to the person responsible for deducting tax at source not to deduct tax, where the total income including the current receipts will not exceed the maximum amount which is not chargeable to income tax.
FAQ-09 : Whether conversion of outstanding interest on loan into loan attracts TDS?
Interest payment to banks/financial institutions: Any interest paid or credited to the banks/financial institutions is not subject to tax deduction U/S 194(3)(iii). Hence TDS is not required to be made on such interest payments and no TDS in case of capitalization of interest on loan as loan.
Interest Payments to Others : In case of Interest paid to persons other than those covered under 194(3)(iii)), TDS is to be deducted u/s.194A. Liability to deduct TDS arises at the time of credit or payment. Conversion of interest outstanding into loan arises after a long period from the time interest liability becomes due for payment, due to inability of the borrower in making the interest payments. The liability to deduct TDS arises only at the time the interest becomes due but not at the time of conversion of interest outstanding into loan.
FAQ-10: How do I activate TDS System for the Company
Ans: TDS Activation : At Company Operations screen (F11: Features >Accounting Features), set as follows :
- TDS Activation : At Enable Tax Deducted at Source, set Yes to Activate TDS Features for the Company (F-1A)
- TDS Details : At Set / Alter TDS Details, set Yes (F-1A), to get Company TDS Deductor screen to enter the TDS Particulars of the Company
- PAN : At PAN / Income Tax Number, enter the Company PAN (F-1B)