INCOME TAX (TAX DEDUCTION AT SOURCE) by Hmingthanga Kipgen

FIRST SESSION

Learning Objectives Brief Introduction to TDS TDS – Workflow TDS Process (Government Offices) Book Adjustment (BIN) Verification of Tax Remittance Income Tax Calculation

Tax Deduction at Source Summary of Section 192 to 194 of the IT Act Any person responsible for making payment under the Head “as in Section 192 to 194” shall at the time of payment, deduct income-tax on the amount payable. COMMONLY USED TERM: Account Office - Treasury / Pay and Account Offices Deductor - DDO / Company etc Deductee / Assessee - Employee / Contractor / Tax Payee etc.

TDS Process - Work Flow BOOK ADJUSTMENT BANK DEPOSIT GAR 7 CHALLAN TAX (TDS) BOOK ADJUSTMENT BANK DEPOSIT GAR 7 CHALLAN ITNS 281 CHALLAN ACCOUNT OFFICE (TREASURY) BANK Only for Govt. Deductor (Offices) Book Identification Number NSDL BIN Details View Both Govt. and Non-Govt. office Challan Identification Number NSDL OLTAS Details CENTRAL BOARD OF DIRECT TAX

TDS Process - Work Flow BOOK ADJUSTMENT BANK CHALLAN DEPOSIT CBDT AG Account Office AG Challan ITNS. 281 Challan Deductor Deductor Deductee (Tax Payee)

TDS Process – Book Adjustment ACCOUNT OFFICES AIN 24G Monthly BIN Details DEDUCTORS TAN 24Q / 26Q Quarterly Token & Receipt Nos. TAX PAYEE PAN ITR Annually ITR-V

Information required for Return of Tax Account Office AIN Number TAN of Deductors DDO Regn. No TDS Deducted by each Deductor Type of Deduction Deductor TAN Number PAN of DDO PAN of Deductees DDO Regn. No DDO Code AO AIN Number BIN/CIN Details IT Deduction Details Deductee PAN Form 16/16A (TDS Certificate)

Tax Payment/Remittance through Account Office Head of Accounts (TDS through Account Office) Major Head : Suspense Account (8658) Minor Head : TDS Suspense (112) Verification of Payment (BIN Details Download) https://onlineservices.tin.egov-nsdl.com/TIN/JSP/etbaf/ViewBIN.jsp

Tax Payment through Bank (OLTAS CIN Verification) https://tin.tin.nsdl.com/oltas/servlet/QueryTaxpayer

INCOME TAX CALCULATION

Income Tax (Tax Slab) Sr. No Total Taxable Salary (Rs.) Income Rates 1 Zero to 2,50,000 0% 2 2,50,001 to 5,00,000 10% 3 5,00,001 to 10,00,000 20% 4 Above 10,00,000 30%

CALCULATION OF INCOME TAX ON SALARY Net Aggregate Income : Rs. 6,89,000 (Less) Deduction U/s 80C, 80CCC, 80CCD(1) : Rs. 1,50,000 (Max. Rs.1.5Lac) Other Section : Rs. 50,000 Taxable Income : Rs. 4,89,000 Income Tax : Rs. 23900 (Less) Tax Credit u/s 87A : Rs. 2000 Net Income Tax : Rs. 21900 (Add Edu. Cess 3%) : Rs. 657 Gross Income Tax Liability : Rs. 22557 Tax Slab Salary Distribution Rate Income Tax 0 – 250000 250000 0% 250001 – 500000 239000 10% 23900 500001 – 1000000 20%

CALCULATION OF HRA EXEMPTION Basic Salary – Rs. (5000x12) – Rs. 60,000/- Dearness Allowance (D.A) – Rs. (1000x12) – Rs. 12000/- House Rent Allowance (H.R.A.) – Rs. (2000x12) – Rs. 24000/- Actual Rent Paid – Rs. (2000x12) – Rs. 24000/- i.e. Annual Salary = Rs. 72000/- The minimum of the following amount shall be exempt Actual HRA received (2000x12) – Rs. 24000/- Rent Paid in excess of 10% of salary ( 24000-7200) – Rs. 16800 40% of Salary – Rs. 28800/- Therefore, Rs. 16800 shall be exempt and the balance Rs. 7200 shall be included in gross salary.

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SECOND SESSION

Learning Objectives Consequences of Default Important Dates Mandatory information for TDS compliances and how to get them? Traces (TDS Reconciliation Analysis And Correction Enabling System) Important Websites

CONSEQUENCES OF FAILURE TO DEDUCT OR PAY SECTION 201(1) of Income Tax Act expressly states that any person liable to deduct TDS on the income distributed, makes default in the deduction and/or payment of TDS, shall be treated “assessee in default” and penalty U/s 221 of Income Tax Act shall be payable by such assessee. SECTION 201(1A) “Without prejudice to the provisions of sub-section (1), if any such person, principal officer or company as is referred to in that sub-section does not deduct the whole or any part of the tax or after deducting fails to pay the tax as required by or under this Act, he or it shall be liable to pay simple interest,— at one per cent for every month or part of a month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted; and at one and one-half per cent for every month or part of a month on the amount of such tax from the date on which such tax was deducted to the date on which such tax is actually paid, and such interest shall be paid before furnishing the statement in accordance with the provisions of sub-section (3) of section 200”

INTEREST FOR DEFAULT Sr. No. Under Section Rates 1 Late Filing of eTDS Return 234E Rs. 200 per day 2 Late Deduction/Short Deduction/Non-Deduction of Tax 201 1% Per Month 3 Late Deposit of Tax 1.5% Per Month PENALTY(Under Section 271H) 1. Failure to submit TDS return within a year of the due date 2. Submission of incorrect details (such as PAN, Challan, TDS amount) in the statement filed Penalty of between Rs 10,000 (ten thousand) to Rs 1,00,000 (one lakh)

Due Dates for Govt. Deductors DEPOSIT OF TAX BIN (for Govt. Deductors only) CIN (for Govt. and Non-Govt.) On the same day for which Sum is Credited On or before 7th Day of corresponding month in which Sum is credited TDS RETURN FILING Quarter Period Due Date Q1 April – June 31-July Q2 July – September 31-October Q3 October – December 31-January Q4 January - March 15-May

Information for TDS Compliances Mandatory details for eTDS Filing and where to get them: TAN (Tax Deduction Account Number) : TIN-FC (offline) or NSDL Website (online) PAN of Person Responsible : TIN-FC and PAN Center - (offline) NSDL Website or UTI Website - (online) BIN/CIN Information : NSDL Website or TRACES website AIN of Account office : Concern Treasury Offices DDO Regn Number : NSDL CRA PAN of Deductee : From Tax Payee (Employee/Contractor etc) Payment details Income Tax Deduction details Previous eTDS Filing Token Number (if any) and Calculation of Income Tax for Salary Employees in case of Annual Statement

TDS Reconciliation Analysis and Correction Enabling System GENERAL FEATURES Statement Status TDS Statement Justification Report Consolidated File Declaration of Non Filing of Statements Request for Resolution (Online Ticketing System) Tax Credit status of Tax Payee Form 16/16A Online and Offline Correction Filing Tracking of Challan/BIN Status Validation of Certificate u/s 197 Digital Signature Certificate (in case of Correction through TRACES

Tax Exemption Certificate (Certificate u/s 197) Form No. 15G Declaration under sub-sections (1) and (1A) of section 197A of the Income-tax Act, 1961, to be made by an individual or a person (not being a company or a firm) claiming certain receipts without deduction of tax. Form No. : 15H Declaration under sub-section (1C) of section 197A of the Income-tax Act, 1961, to be made by an individual who is of the age of sixty years or more claiming certain receipts without deduction of tax

IMPORTANT WEBSITE Income Tax http://www.incometaxindia.gov.in E-Filing http://www.incometaxindiaefiling.gov.in TRACES http://www.tdscpc.gov.in NSDL https://www.tin-nsdl.com

OUR CONTACT INFORMATION CAISIAS RESEARCH AND CONSULTING TAX INFORMATION NETWORK – FACILITATION CENTRE (TIN-FC) Managed by NSDL MV-106, MISSION VENG AIZAWL, MIZORAM – 796005 PH: 0389-2321164 MB: 9612503228

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