tds 2010-11

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K P R K And Associates

Chartered Accountants

(Exclusively for Private Circulations Only) 1

T.D.S/T.C.S AT GLANCE FOR A.Y. 2011-2012

(08.05.2010)Tax Deducted at Source (TDS) was introduced to facilitate the payment of Tax while receiving the income and

it follows the concept Pay as you Earn. The tax deducted at source is one way of collecting the taxes by the

department.

Liability of Tax Deduction:-

Persons liable to deduct TDS

a. Individual/HUF- If covered under Tax Audit u\s 44AB during the F.Y.2009-10b. Partnership Firmsc. Limited Companyd. Local Authoritye. Association of Personf. Body of Individual

The liability to deduct tax on salary income payable to the employee is also to Individual and HUF.

Rate of deduction is now based on the status of payee and not on the basis of type of payment.

Tax Deduction Account Number U/S 203 A:-

It is obligatory for all persons responsible for deducting tax at source to quote the T.D.S No. i.e. TAN in the

challans, TDS certificates with deductees PAN and address & Quarterly returns etc.

Rate of Deduction and Due Date of Filing Return

(As per Finance Bill passes for F.Y. 2010-11)

Rate of Tax to be deducted at

source (Deductee must have pan)

Nature of payment ( Important

and useful deductions only)

U/S When to deduct tax at

Source

IT Edu.

Cess

SHEC Total

1. Salary

A. For Individual, every

HUF/ AOP/ BOI/

artificial juridical

person

192

Exceeds Rs.1, 60,000/- p.a.

0 to 1,60,000

1,60,001 to 5,00,000

5,00,001 to 8,00,000

Above 8,00,001

Nil

10%

20%

30%

2%

2%

2%

---

1%

1%

1%

Nil

10.30%

20.60%

30.90%

B. For Resident Woman(who is below 65 years as

on 31.03.2011)


0 to 1,90,000

1,90,001 to 5,00,000

5,00,001 to 8,00,000

Above 8,00,001

Nil

10%

20%

30%

2%

2%

2%

---

1%

1%

1%

Nil

10.30%

20.60%

30.90%

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C. For Resident Senior

Citizen(who is above 65 years as on

31.03.2011)


0 to 2,40,000

2,40,001 to 5,00,000

5,00,001 to 8,00,000

Above 8,00,001

Nil

10%

20%

30%

---

3%

3%

3%

Nil

10.30%

20.60%

30.90%

Nature of payment (

Important and useful

deductions only)

U/S When to deduct tax at

Source

Rate of Tax to

be deducted at

source(Deductee

must have pan)

2. Interest other thanInterest on Securities

A. Payable by Banks, Post

Office, Co-Op Banks

Individual / HUF

194A Exceeds Rs. 10,000/- p.a

For Individual

For Firms/ AOP

Domestic Companies

10%

10%

20%

B. Interest Payment by other

than above194A

Exceeds Rs. 5,000/- p.a

For Individual

For Firms/ AOP

Domestic Companies

10%

10%

20%

3. Payment to contractors &

Sub Contractors

( payment to resident

contractor)Contractors /

Sub Contractors &

Advertisements

194C Contract value more than Rs. 20,000/-

(Rs.30000/- from July 1, 2010) per contract

or Rs. 50,000/- (Rs. 75,000/- from July 1,

2010) during the year.

For individual /HUF

For firms/ AOPDomestic Companies

1%

2%2%

Transporter - deductee

has PAN(See Note 3 & 4)

For individual /HUF

For firms/ AOP

Domestic Companies

--

--

--

4. RENT

i) Rent on Land, Premises,

Furniture etc.

ii) Rent on Plant , Machinery

& Equipment, vehicles

194I Exceeds Rs.1, 20,000/- p.a. upto June 30,

2010 (Rs.1,80,000/- p.a. from July 1,2010)

For Individuals/ HUF

For Firms/ AOP

Domestic Companies

For Individuals/ HUF

For Firms/ AOP

Domestic Companies

10%

10%

10%

2%

2%

2%

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5. Fees for professional or

technical services (resident)

194J Exceeds Rs 20,000/- p.a. upto June 30,2010

(Rs.30,000/- p.a. from July 1,2010)

For Individual/ HUF

For Firms/ AOP

Domestic Companies

10%

10%

10%

6. Brokerage & Commission 194H Exceeds Rs 2,500/- p.a. upto June 30,2010

(Rs.10,000/- p.a. from July 1,2010)

For Individual

For Firms/ AOP

Domestic Companies

10%

10%

10%

Any payment made to NRI or Foreign Company section 195 is applicable for rate schedule separately.

Section Nature of Payment Status Tax (%)

194E Payment to nonresident sportsmen or sports association 10

195(a) Income from foreign exchange assets payable to an

Indian citizen

20

195(b) Income by way of long-term capital gain referred to in

sec. 115E

10

195(c) Income by way of Short-term capital gains u/s. 111A 15

195(d) Income from other long-term capital gains 20

195(e) Income by way of interest payable by

Government/Indian concern on money borrowed or

debt incurred by Government or Indian concern in

foreign currency

20

Royalty payable by Government or an Indian concern

in pursuance of an agreement made by non-resident

with the Government or the Indian concern after March31, 1976, where such royalty is in consideration for the

transfer of all or any rights (including the granting of a

licence) in respect of copyright in any book on a subject

referred to in the first proviso to section 115A(1A) to

the Indian concern or in respect of computer software

referred to in the second proviso to section 115(1A), to

a person resident in India -

1.Where the agreement is made before June 1, 1997 30

2.Where the agreement is made after May 31, 1997 but

before June 1, 2005

20

195(f)

3.Where the agreement is made on or after June 1,

2005

10

195(g) Royalty (not being royalty of the nature referred to in

(e) sub para) payable by Government or an Indian

concern in pursuance of an agreement made by non-

resident with the Government or the Indian concern and

where such agreement is with an Indian concern, the

agreement is approved by the Central Government or

where it relates to matter included in the industrial

policy, the agreement is in accordance with that policy

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COMPANY 501.Where the agreement is made after March 31, 1961

but before April 1, 1976 OTHERS 30

2.Where the agreement is made after March 31, 1976

but before June 1, 1997

30


before June 1, 1997

20

4.Where the agreement is made on or after June 1,2005 10

Fee for technical services payable by Government or an

Indian concern in pursuance of an agreement made by

non-resident with the Government or the Indian

concern and where such agreement is with an Indian

concern, the agreement is approved by the Central

Government or where it relates to matter included in

the industrial policy, the agreement is in accordance

with the policy -

COMPANY 501.Where the agreement is made after February 29, 1964

but before April 1, 1976 OTHERS 30

2.Where the agreement is made after March 31, 1976but before June 1, 1997

30


before June 1, 2005

20

195(h)

4.Where the agreement is made on or after June 1,

2005

10

COMPANY 40195(i) Any other income

OTHERS 30

196A Income in respect of Units of Non-residents 20

196B Income and Long-term Capital gain from units of an

Off shore fund

10

196C Income and Long-term Capital Gain from ForeignCurrency Bonds or shares of indian companies

10

196D Income of Foreign Institutional Investors for Securities 20

Notes:

**** Most Important *****

1. With effect from 01.04.2010 Deductees are required to furnish the PANSec206AA: If deducteefails to furnish PAN to deductor, the deductor shall apply highest of the following rates for

deducting TDS:-

At the rate specified in the relevant provision of this act, or At the rate or rates in force, Or at the rate of 20%

2. No Education cess and Higher Secondary Education Cess are applicable for TDS purpose except incase of payment of salary to resident & non- residents and any other payment to non resident or

Foreign Company. Only the specified TDS rates should be considered for deduction. (AS PER NEW

AMENDMENT W.E.F 01.10.2009)

3. Persons carrying business of plying, hiring or leasing goods carriages.

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Need not deduct TDS if contractor furnishes PAN. Will have to furnish information as may be prescribed.

4. The NIL Rates will be applicable if TRANSPORTERquotes/ gives his PAN5. Tax is not deductible under section 193,194,194A, or 194 EE if the recipient makes a declaration in

Form 15G/15H under the provisions of 197A.

Form 15G is for senior citizen Form 15H is for any other person

Surcharge on Income Tax:-

** Surcharge: For payment to residents and domestic companies, there will be no surcharge and cess on

the basic rate of TDS (AS PER NEW AMEMDMENT)The amount of income tax deducted shall be increased by a surcharge as under:-

a) In case of Domestic Company ifnet Income Exceeds Rs.1 Crore than payer has to apply surcharge

of 10% on TDS amount. (Only in case of the TDS of Salaried Persons)

b) In case of Foreign Company (Payee), if net Income exceeds than payer has to apply surcharge of2.5% on TDS amount not 10% as in case of Domestic company.

EDUCATION CESS:-

For Others:-

For F.Y. 20010-11 there is no surcharge, education cess (As Per new Amendment w.e.f 01.10.2009)

For Salaried Persons:-Edu. Cess shall be calculated @ 3% p.a. on the amount of income tax deducted .

Education Cess @ 2 % plus Secondary and Higher Secondary Edu. Cess 1%

Time of Deposit of TAX

Sr. No. Nature of Payment U/s Time Of Deposit of Tax

1. Salary 192 Within one week from the last date of the month in whichthe deduction is made.

2. Interest other than

Interest on Securities

Payable by persons other than

Individual / HUF

194A In any other case: - within one week from the last date of

the month in which deduction is made.

Quarterly payment is permitted by the Assessing Officer

(with the approval of the deputy commissioner)in special

cases on July 15, Oct 15, Jan 15, & April 15

3 Payment to contractors &

Sub Contractors

194C In any other case: - within one week from the last date of


4 Rent 194I In any other case: - within one week from the last date of


5 Fees for professional or

technical services

194J In any other case: - within one week from the last date of


6 Brokerage & Commission 194H In any other case: - within one week from the last date of


Quarterly payment is permitted by the Assessing Officer

(with the approval of the deputy commissioner)in special

cases on July 15, Oct 15, Jan 15, & April 15

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Notes:-

a) Where amount is credited to the payees Account on the last day of accounting year, the tax amountthere on is to be deposited within two months from the end of the month in which credit is made.

b) TDS certificate need not to be furnished in respect of tax deducted and paid.c) Every person deducting of collecting tax shall be required to furnish Quarterly Statements to the

prescribed Income Tax Authority who will in term furnish as annual statement of the tax deducted or

collected to the assesses.

d) Where tax is deducted on behalf of the government, tax should be deposited on the same day, withoutany challan form.

e) With effect from July 01 ,2010 (NEW AMENDMENT ), if a person fails to deduct tax at source orafter deduction fails to deposit TDS, He is liable to pay interest u\s 201(1A) as follows:-

Rate of Interest

(Per Month or

Part)

Period for which Interest is Payable

1% From the date on which tax was deductible to the date on which tax is actually

deducted.1.5% From the date on which tax was actually deducted to the date on which tax is

actually paid

Return of TDS:-Every person, deducting tax at source, is required to submit return of tax deducted as follows:-

Different payments In case the person

deducting tax is a

company or government

In case the person deducting

tax is other than company or

government

Salary Form No.24 in electronic

format & Form No 27A

Form No. 24Q

Payment (other thanSalary) to a resident

Form No.26 in electronicformat & Form No. 27A

Form No. 26Q

Payment (other than

Salary) to a non resident

Form No.27 in electronic

format & Form No. 27A

Form No. 27Q

If the return is submitted in computer media it should be accompanied by Form No. 27A

Date of Filing the Returns:-

Different payments Form No. Particulars Due Date

Salary 24Q Quarter ending 30th

June, 2010

Quarter ending 30th

September, 2010

Quarter ending 31st December, 2010

Quarter ending 31st

March, 2011

15th

July, 2010

15th

October, 2010

15th January, 2011

15th

June, 2011

Payment other than

salary to a resident

26Q Quarter ending 30th

June, 2010

Quarter ending 30th

September, 2010

Quarter ending 31st

December, 2010

Quarter ending 31st

March, 2011

15th

July, 2010

15th

October, 2010

15th

January, 2011

15th

June, 2011

Payment other than

salary to a non

resident

27Q Quarter ending 30th

June, 2010

Quarter ending 30th

September, 2010

Quarter ending 31st

December, 2010

15th

July, 2010

15th

October, 2010

15th

January, 2011

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Quarter ending 31st

March, 2011 15th

June, 2011

Consequence of Failure to Deduct or pay (Penal Provisions):-

1) Failure to deduct the whole or any part of tax at source u/s 271 C is liable to penalty of sum equal tothe amount of tax which he failed to deduct.

2) Failure to pay the TDS u/s 276 B is punishable with rigorous imprisonment for a term which shallnot be less than 3 months but which may extent to 7 years and with fine.

3) If a person is held to delivery in due time a copy of Quarterly statement of tax payment he shallpay, by way of penalty, a sum of Rs 100 per day for the delay during which default continues.

4) In case of failure in respect of furnishing Annual Return in due time, assesses should be liable topay penalty u/s 272 (A)(2)(C) @ Rs. 100 per day for the delay during which the default continues

or amount of TDS whichever is less.

5) Failure to deduct/ pay tax at source u/s 220, person is liable to pay interest @ 13% p.a. or theamount of such tax from the date on which such tax was deductible to the date on which tax is

actually paid. However such interest is required to be paid on or before due date for filing the

quarterly returns (w.e.f. 1st

June, 2006).

6)

In case of failure to apply for allotment of TAN and failure to quote TAN in challans, certificatesand statements, person is liable to pay penalty u/s 272 BB to the extend of Rs. 10,000/- of failure to

deduct or pay.

Other Informations:

1. Payment of TDS is required to be made electronically only.2. Form 15G/ 15H declaration for no deduction of tax will become invalid if PAN is not mentioned

therein.

3. PAN will have to be mentioned in bills, vouchers and other documents communicated betweendeductor and deductee.

4. If deductee furnishes invalid PAN or submits PAN belonging to someone else, it will amount to nonfurnishing of PAN

5. No TDS on zero coupon bonds issued by scheduled banks: Section 194A. (w.e.f. 01-04-2009)

6. No TDS for payments from New Pension Scheme: Section 197A. (w.e.f. 01-04-2009)

If an assessee fails to deduct TDS on the above following payment then the amount of expenditure will bedisallowed u\s 40(a )(ia) of Income Tax ACT,1961.

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TAX COLLECTION AT SOURCE U/S 206C(A.Y. 2011-12)

Under section 206 C in some cases tax has to be collected at source.

Person responsible to collect tax at source:-

Every person being a seller shall collect tax from the buyer of goods specified in sec 206C (1)

Meaning of Seller: Seller means

1. The Central Government2. A State Government or3. any local authority or corporation or authority established by or under Central Govt. or Provincial Act,4. Any Company, or5. Firm, or6. Co-operative Society7.

Individuals/ HUF (if books are audited u/s 44AB

Meaning of Buyer: - Buyer means a person who obtains in any sales by way of auction, tender or any

other mode, goods of the nature specified in the table or the right to receive any such goods. It however

does not include the following:

A Public Sector Company, the Central Government, a State Government, And an Embassy, aHigh Commission, Legation, Commission, Consulate and the trade representation, of Foreign

State & a Club; or

A buyer in retail sale of such goods purchased by him for personal consumption.Note: If income of buyer is exempt u/s 10(26), then tax collected be collected at source.

Tax Collection Account Number U/S 20C A:-

It is obligatory for all persons responsible for collecting tax at source to quote the T.C.S No. i.e. TAN in the

challans, TCS certificates & periodical returns etc.

How to compute Tax Collected at Source:-

SI.

No.

Nature of Goods % rate of tax collection at source

(TCS) applicable on purchase

price

1. Tendu Leaves 5%

2. Timber obtain under a forest lease 2.50%

3. Timber obtain by any mode under a forest lease 2.50%

4. Any other forest produce other than timber & tendu leaves 2.50%

5. Scrap 1%

6. Parking Lot, Toll plaza, (Note 1 & 2) 2%

7. Alchoholic Liquor for human consumption 1%

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Notes:-

1. The above scheme of tax collection has been extended to cover parking auctions, toll auctions or miningleases with effect from Oct 1, 2004

2. Tax Collection at Source in respect of mining and quarrying of mineral oil- No TCS w.e.f. June 1,2007

3. Surcharge- For the F.Y. 2009-10, surcharge at the rate of 2.5% is applicable only if payer is a Foreignthe above rates are subject to surcharge @10%

4. There is no education cess for the F.Y.2010-11 if the payer is resident, However if, payer is a non-resident or a Foreign Co. then Education Cess is applicable.

Scrap: - Scrap has been defined as waste and scrap from manufacturing or mechanical working of materials

which is definitely not usable as such. Accordingly it will not include any waste or scrap-

a. Which dose not arise from manufacture or mechanical working of materials; orb. Which is usable as such.

Thus, the following are not covered:-

a.

Waste or scrape arising from packing materials, newspapers, old machinery scrapped, etc., whichcannot be said to arise from manufacture; or

b. By products generated from the manufacturing process as the same could be used as such.It can be inferred that, in case of sale of scrap, the provision would apply to only those sellers who are engaged

in the business of manufacturing or mechanical working of materials.

Deposit of Tax: - Tax collected u/s 206C shall be deposited within 7 days from the last day of the month in

which tax is collected to the credit of Central Government. For non payment or late payment, interest is

payable @ 1%per month or part thereof.

Quarterly Statement of TCS:-

Quarterly TCS return should be submitted (w.e.f. 1st

April, 2005) after the end of each quarter in Form 27EQ

within 15 days from the end of each quarter. (76 days in the case of last quarter) Quarterly TCS cannot be

submitted unless interest for late deposit of TCS is paid.

Issue of Certificate:-

Within the period of one month from the end of the month in which tax is collected, the person collecting tax

should issue a certificate of tax collected to the buyer in Form 27D.

Where more than one certificate is required to be furnished to the buyer for TCS in respect of period ending

September 30 and March 31in each financial year, the person collecting tax may (on request of buyer), issue

within end of such period, a consolidated certificate in Form 27D for collected during whole of such period.

Note:- The details given is for just knowledge and working facility for you.

tds 2010-11

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