TDS i.e., tax deducted at source is the method through which the government of India collects indirect tax as per the Income Tax Act,1961. It is valid on several incomes such as salaries, and the commission received, interest received, etc.
However, TDS is not relevant to all incomes and all transactions of a person. The Income Tax Act sets different TDS rates for distinct payments and diverse categories of recipients. Tax deduction takes place to keep the source of the revenue constant and stable for the government throughout the year. TDS also avert people from avoiding taxes.
Now, let us take a look at the deduction criteria?
Income and expenditure, including interest from banks, lotteries, salaries, rent payment, etc. come under the TDS criteria. The paying source holds on to a certain percentage when you receive payment under these criteria. For example, an employer before paying a salary to his employee withholds or deducts a certain amount of money to pay taxes on behalf of him to the income tax department. TDS is applicable while getting a property, paying rent, or paying a salary to an employer.
The one who deducts the amount must deposit the deducted amount to the government within the specified due date. You can make the TDS payment online now.
Below is the step by step procedure of the TDS deposit online.
- Visit the NSDL’s website for e-payment or online payment of taxes.
- Choose ‘CHALLAN NO./ITNS 281’ under TDS/TCS unit. Later, it will redirect you to the e-payment webpage.
- Now, enter the required details like Select whether you are a company deductee (0020) or non-company deductee(0021) as applicable.
- Input the Tax Deduction or Collection Account Number (TAN) and assessment year to which the payment relates. The assessment year is the year that tails the financial year of the transaction.
- Now select whether payment is made by a taxpayer for regular assessment.
- Pick the nature of payment, mode of payment, and click on ‘submit.’
- After submission, a confirmation preview will appear on your screen. The full name of the taxpayer will display on the confirmation screen if the TAN is appropriate.
- Once you give the confirmation, it will redirect you to the net-banking site of your bank.
- Next, log into your account and OTP/authentication device password and make the payment.
- Following a successful payment, a challan counterfoil containing CIN, payment details, and bank name through which e-payment was made will appear on the screen. This counterfoil is proof of the payment completed.
The TDS deposit online method is easier and user-friendly when we compare it to the tedious and time-consuming offline TDS deposit procedure.
After depositing the TDS to the income tax department (as per section 203), the person who deducts i.e., deductor must issue a TDS certificate to the deductee as the tax was paid on his behalf.
TDS Online Deposit Benefits
The payment facility is available 24×7
As it is an online facility, there is no time related or day related problems. You can do it whenever you wish to wherever you wish to.
Immediate acknowledgment of the payment.
You get to know whether the payment has been made effective immediately as you get the acknowledgment slip right after the payment.
You can download the acknowledgment copies or the challan copies and print them and use them for future purposes.
Less paper usage
The forms are filed digitally on the website. Hence, you do not require the actual form. Also, the submission of supporting documents can be digital, so you need not give hard copies. It is an environmentally friendly process as it doesn’t require a lot of paperwork
Reduction in malpractices
The former offline submission of TDS gave rise to corruption and other malpractices. Sometimes, you even have to pay external charges to the officer for completion of your work. Now due to the emergence of e-payments frauds, scams and other malpractices have died out.
As the online way has several benefits, you should start filing your TDS online before the deadlines.