Income Tax Explainer: What is TDS challan payment

TDS, expanded as Tax deducted at source is a type of indirect tax administered by the Central Board of Indirect Taxes. Under the system of TDS, the person making some specified kind of payments like salary, rent, interest on deposits, commission, etc. is expected to deduct a specified percentage of tax before making the payment to the concerned party. The persons responsible to deduct TDS under the Income Tax Act are liable to deposit the TDS amount thus deducted to the Income Tax Department.

Due dates for depositing TDS

The TDS that a payer has collected in a given month must be deposited with the government by the 7th of the next month. Only in case of deductions made in the month of March can be paid to the Income Tax Department by April 30. The person collecting and depositing the TDS also need to prepare a statement for every quarter and submit the same to the Income Tax Department. After this, the Income Tax Department will issue a TDS certificate to the payee.

What is TDS challan

TDS challan is used for depositing the TDS with the government. This is a single challan that can be used for depositing the taxes collected under the different sections of the Income Tax Act. If the assesse wants to pay the TDS without challan, the TDS collected must be deposited on the same day when the person collected the TDS.

TDS Challan 281

TDS Challan 281 is used both by Corporates and non-corporate entities to deposit the TDS or TCS (Tax Collected at Source) with the government. While selling some kinds of goods, the sellers need to collect the TDS or TCS from the buyers at the point of sale. It is possible to file the TDS challan 281 in two modes namely online and offline. If the payment is done online or through some banks, a challan identification number (CIN) is issued.

TDS Challan 280

TDS challan 280 is used to deposit the collections made under the categories of Income Tax payments for Advance Tax, Self-Assessment Tax, Surcharge, Regular Assessment Tax, Tax on Distributed Profits or Income and others. This challan can also be paid either in online or offline mode.

What one must know before collecting TDS

The persons responsible for collecting taxes through TDS are given Tax Deduction and Collection Account Number (TAN). This is a 10-digit alpha-numeric number available on the NSDL website. To get this number, the person must submit Form No. 49 B along with a specific fee. The assesse liable to deduct TDS will invite a fine of Rs. 10,000 if they fail to quote TAN on all their communications about TDS with the Income Tax Department.

TDS Online Payment

Here is a step by step guide to make TDS challan payment in the online mode.

Login to http://www.tin-nsdl.com

Select the challan number (ITNS 280, ITNS 281, or others)

Enter PAN/TAN and the other details needed

If the Pan/TAN is valid, the name of the taxpayer will appear on the screen.

The site will guide the tax payer to the net-banking page.

The tax payer must now make the payment online through the bank.

After the payment is done, a challan counterfoil will display on the screen with CIN. This is the proof of payment.
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