(Q1.)What are the new Section codes related to transaction in kind, inserted in Annexure-I (i.e., Deductee details) under Form 26Q? - New Section Codes related to transaction in kind, inserted in Annexure-I (i.e., Deductee details) under Form 26Q are as follows:
(Q2.)What is Proviso of Section 194B (i.e., Section code 194BP)?
- In a case where the winnings from lottery and Crossword puzzle are
(a) wholly in kind or
(b) partly in cash and partly in kind but the part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of the winnings.
(c) The person responsible for paying shall, before releasing the winnings, ensure the Tax has been paid in respect of the winnings.
Note: This section code 194BP is applicable from 1-July-2022, F.Y. 2022-2023 onwards. (Q3.)What is Proviso of Section 194R (i.e., Section code 194RP)?
- In a case where the benefit or the perquisite as the case may be,
(a) is wholly in kind or
(b) partly in cash and partly in kind but such part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of such benefit or perquisite.
(c) The person responsible for providing such benefit or perquisite shall, before releasing the benefit or perquisite, ensure that tax required to be deducted has been paid in respect of the benefit or perquisite.
Note: This section code is applicable from 1-July-2022, F.Y.- 2022-2023 onwards. (Q4.)What is proviso of Section 194S (i.e.: Section Code 194SP)?
- In a case where the consideration for transfer of virtual digital asset is —
(a) wholly in kind or in exchange of another virtual digital asset, where there is no part in cash; or
(b) partly in cash and partly in kind but the part in cash is not sufficient to meet the liability of deduction of tax in respect of whole of such transfer.
(c) The person responsible for paying such consideration shall, before releasing the consideration, ensure that tax required to be deducted has been paid in respect of such consideration for the transfer of virtual digital asset.
Note: This section code is applicable from 1-July-2022, F.Y.- 2022-2023 onwards. (Q5.) Who is responsible to pay the tax, deducted under section code 194BP,194RP & 194SP?
- Recipient (Taxpayer) is liable to pay tax deducted under section code 194BP, 194RP & 194SP. Taxpayer should pay the tax in the form of advance tax.
Note: Deductor can also pay tax w.r.t section code 194BP, 194SP & 194RP by using Challan ITNS-281. (Q6.)Can a Deductor report Challan 280 paid by Deductee with minor head 100?
- Yes, Deductor can report transaction details w.r.t Section code 194BP, 194SP & 194RP in Form 26Q (TDS statement) with Challan ITNS 280 paid by Deductee under minor head 100.
(Q7.)What kind of demands can be raised on the basis of Challan ITNS-280 (with Minor Head 100)? - On the basis of Challan ITNS-280 (with Minor Head 100) below demands can be raised:
- Short Deduction (Other) Transaction in kind
- Short Deduction (Challan Mismatch) Transaction in kind
(Q8.)What can be the reason of Short Deduction (Others) Transaction in kind on the basis of Challan ITNS-280?
- Short Deduction (Others) Transaction in kind can be raised because of following reason:
1. Where Challan deposit date is after the date of transaction and other details (PAN, CIN, Amount, minor head code) of challans are matched then Short Deduction (Others) Transaction in kind will be raised.
For e.g.: Date of Payment/credit as per Deductee detail record is 14-Sept-2022, Challan deposit date as per OLTAS and statement challan details is 15-Sept-2022 then Short Deduction (Others) Transaction in kind will be raised.
Note: Challan should belong to the same quarter in which the transaction has happened and date of deposit of the challan should be on or before the date of transaction.
2. In case of 194BP: Short Deduction (Others) demand will be raised for Section-Code 194BP in Original/Correction Processing in case of no/insufficient balance in Deductee challan ITNS-280 (with Minor head 100). (Q9.)What can be the reason of Short Deduction-Challan Mismatch (SD_CM) demand in case of transaction in kind based on Challan ITNS-280?
- Demand of Short Deduction-Challan Mismatch (SD_CM) in case of transaction in kind can be raised for section code 194BP, 194SP & 194RP after Statement processing in case of not matching of Deductee Challan ITNS-280 (Minor Head - 100) with the challan reported in the statement i.e., SD_CM will be raised in case of mismatch between the challan reported in statement and OLTAS.
Challan will be matched based on the following fields:
a) PAN
b) CIN details (BSR Code, Date of Deposit, Challan Serial Number)
c) Amount
d) Minor Head
Note: Challan should belong to the same quarter in which the transaction has happened. (Q10.)Who will be responsible to set off demand?
- Deductor can set off SD_Others and SD_CM demands through ITNS 280 (with Minor Head-100) and ITNS 281.
Note: For Other Demands, Deductor can set off by using challan ITNS - 281. (Q11.)What are the flags applicable for section codes 194RP, 194SP & 194BP?
- Below flags are applicable for section codes 194RP, 194SP & 194BP:-
Flags applicable for Section Code 194BP-
1. Flag 'Y' - Transaction where tax has not been deducted as amount paid/credited to the vendor/party has not exceeded the threshold limit (Flag "Y" is applicable for section code 194BP on Valid PAN)
2. Flag 'C'- Deduction of tax at higher rate due to non-availability of PAN (it is applicable on Invalid PAN, if Deductee row present under TAN challan (Minor Head Code-200/400))
Flags applicable for Section Code 194RP-
1. Flag 'U' - If the deduction is on higher rate in view of section 206AB for non-filing of return of income (Flag 'U' is applicable on Valid PAN in case of Deductee tagged under minor head code-100(PAN Challan) and minor head code-200/400 (TAN Challan))
2. Flag 'C'- Deduction of tax at higher rate due to non-availability of PAN (it is applicable on Invalid PAN, if Deductee row present under TAN challan (Minor Head Code-200/400))
3. Flag 'Y' - Transaction where tax has not been deducted as amount paid/credited to the vendor/party has not exceeded the threshold limit (Flag "Y" is applicable for section code 194RP on Valid PAN)
Flags applicable for Section Code 194SP-
1. Flag 'U' - If the deduction is on higher rate in view of section 206AB for non-filing of return of income (Flag 'U' is applicable on Valid PAN in case of Deductee tagged under minor head code-100(PAN Challan) and minor head code-200/400 (TAN Challan))
2. Flag 'C'- Deduction of tax at higher rate due to non-availability of PAN (it is applicable on Invalid PAN, if Deductee row present under TAN challan (Minor Head Code-200/400))
3. Flag 'Y' - Transaction where tax has not been deducted as amount paid/credited to the vendor/party has not exceeded the threshold limit (Flag "Y" is applicable for section code 194SP on Valid PAN) (Q12.)Is it possible to download TDS certificate (Form 16A) in case of Deductee row(s) containing section code 194BP,194SP & 194RP available under Challan 280 (with minor head-100)?
- No, TDS certificate (Form 16A) cannot be generated in case of Deductee row (s) containing section code 194BP,194SP & 194RP under Challan ITNS-280 (with minor head-100) reported in the Statement.
