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- (Q.1)What type of demand may be generated after processing of 26QD challan cum statement?
- Following are the types of Defaults that may get generated on 26QD processing: -
1. Short Deduction: Short deduction is computed when the rate at which TDS Deducted' is less than 5%.
Short Deduction Computation u/s 200A
Note: - In case of Lower Deduction Certificate, applied tax rate can be less than tds rate as per Income tax act and in that case TDS Deductible will be calculated accordingly.Sr. No Section Code Amount Paid / Credited as per 26QD(Rs.) TDS Deposited as per challan (s)(Rs.) Rate at which Deposited as per 26QD (%) TDS Rates as per Act (%) TDS Deductible (5% * Amount Paid/credited as per 26QD) (Rs.) Short Deduction (Rs.) (Col 7 - Col 4) 1 2 3 4 5 6 7 8 1 194M 9252000.00 9252.00 0.10% 5% 462600.00 453348.00
2. (a)Late Payment Interest: When Payer deposits the TDS after due date of challan deposit, it is a case of late payment and interest will be charged accordingly. Late payment interest will be charged @ 1.5% per month from the date of tax deduction to date of tax deposition.
Late Payment Interest Computation u/s 200A read with Sec 201(1A))
Note: As per Rule 30(2C), notwithstanding anything contained in sub-rule (1) or sub-rule (2), any sum deducted under section 194M shall be paid to the credit of the Central Government with in a period of 30 days from the end of the month in which the deduction is made and shall be accompanied by a challan-cum-statement in Form No. 26QD.Sr. No Date of Deduction as per 26QD (dd-mmm-yyyy) Due Date for TDS Deposit(dd-mmm-yyyy) Date of Deposit as Per OLTAS (Challan)(dd-mmm-yyyy) TDS amount consumed from challan (Rs.) Period of Delay in Months Interest on Late Payment U/S 201 (1A) (Rs.) (Col 5 * Col 6 *1.5% 1 2 3 4 5 6 7 1 31-Jan-20 2-Mar-20 10-Mar-20 9252 2 277.56
3.(a) Late Deduction Interest: When Deductor does not deduct the TDS amount on the date of Payment/Credit, then, Interest on Late deduction is computed i.e., if the date of deduction is after the date of payment/credit, then the late deduction interest is computed. Late deduction interest is charged @ 1% per month from date of payment/credit to date of tax deduction.
Late Deduction Interest Computation u/s 200A read with Sec 201(1A)
Note: Due date of deduction will be date of payment or credit whichever is earlier.Sr. No Date of Payment/credit as per 26QD (dd-mmm-yyyy) Due Date of Deduction (dd-mmm-yyyy) * Date of Deduction as Per 26QD (dd-mmm-yyyy) TDS Deductible (5% * Amount Paid/credited as per 26QD) (Rs.) Period of Delay in Months Interest on Late Deduction U/S 201 (1A) (Rs.) (Col 5* Col 6) *1% 1 2 3 4 5 6 7 1 27-Feb-20 27-Feb-20 10-Mar-20 6620 2 132.40
3.(b) Interest on Short Deduction:It is calculated @ 1% per month or part of the month from the date on which tax was deductible to the date of the processing of statement. Please note that 'interest on Short Deduction' is provisional in nature. As you pay the short deduction default amount, the corresponding interest (i.e., interest on short deduction) would be reversed and the "Interest on Late payment" or "Interest on late deduction" shall be levied appropriately, as the case may apply.
Short Deduction Interest Computation u/s 200A read with Sec 201(1A)Sr. No Short Deduction (Rs.) Date of Payment/Credit as per 26QD (dd-mmm-yyyy) Order Passed Date as per intimation(dd-mmm-yyyy) Period of Delay in Months Interest due to short deduction (Rs.) (Col 2 * Col 5 * 1%) 1 2 3 4 5 6 1 453348 7-May-20 12-Feb-22 22 99736.56
4. (a) : As per section 234E, where a person fails to file the TDS/TCS statement within the due date prescribed in this regard then he shall be liable to pay, by way of fee, a sum of Rs.200 per day during which the failure continues. Fee amount will not exceed TDS deductible as per 26QD filed.
Short Deduction Interest Computation u/s 200A read with Sec 201(1A)
Late filing fee Computation u/s 234E
Note-1: As per Rule 30(2C), notwithstanding anything contained in sub-rule (1) or sub-rule (2), any sum deducted under section 194M shall be paid to the credit of the Central Government with in a period of 30 days from the end of the month in which the deduction is made and shall be accompanied by a challan-cum-statement in Form No. 26QD.Sr. No Due Date of Filing of 26QD*(dd-mmm-yyyy) Date of deposit of challan(dd-mmm-yyyy) Delay in Filing (No. of Days) Fee per Day (Rs.) Total Fee (Rs.) (Col 4 * Col 5) Total TDS Deductible (5% * Amount Paid/credited as per 26QD) (Rs.) Fee Payable = Min (Col 6, Col 7) (Rs.) 1 2 3 4 5 6 7 8 1 30-Mar-20 02-April-20 3 200 600 6620 600
Notes:
1) Interest is chargeable for every month or part of the month on the amount of such tax.
2) A month is considered to be a calendar month as per general clauses act. - Demand payment for TDS on "Payment to Resident Contractors and Professionals" can be done through Income tax Portal (www.incometax.gov.in).
For further information, please refer E-Tutorial-Demand Payment for: TDS on Property(26QB) / Demand Payment Rent of Property(26QD)/Demand Payment for TDS on Resident Contractors and Professional(26QD), Demand Payment for TDS on Transfer of Virtual Digital Asset(26QE). - Justification Report consists of various defaults/errors identified by the Income Tax Department (ITD) while processing the form 26QD filed by payer for a particular transaction on Payment to Resident Contractors and Professionals of a financial year. It provides detailed information/calculation about the defaults.
- No, Demand for late filing and interest on late payment cannot be waived off.
- Payer can select "Other" option in the Challan for making the payment of Late filing fee u/s 234E if column for Fee is not available.
