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TDS changes may be applicable from 2nd or 3rd Quarter of 2009-10


Recent press release has kept TDS related changes on abeyance. This Temporary inactiveness of changes, may not be lasting longer.

As per the information available from various sources, it may be mandatory for providing UTN in the ITR of 2010-11 assessment year. This certainly means that, Deductor should get UTN for 2009-10 financial year TDS transactions, which is the result of Form 17 implementation.

UTN on its own plays a prominent role in giving TDS credit to the PAN holder. It initially accounts for instant credit of TDS to PAN holder once Deductor pays amount to Bank. Further having UTN will also help in reconciling TDS credits to PANs, where PAN will be initially missing (and further quoted by Deductor in his TDS return/certificate).

On the same lines, it is said that, new TDS provisions are expected to be in place from 2nd or 3rd quarter.

  1. Department would reconcile the TDS returns filed for earlier quarter(s) of 2009-10, which was prior to TDS changes implementation. This will be only for the deductions under the challans with status BOOKED.
  2. From Quarter 3, Form 24C may be in place.
    1. This has to be filed in XML format, for which schema will be given by department shortly.
    2. There may not be need of digital signature / login for uploading this return.
    3. Deductor may also have to file 24C for earlier quarters of 2009-10, which was prior to implementation.
  3. Form 17 may be in place from October 2009, which should be used for payments of 3rd quarter. This is once more subject to date, and may also be postponed to January 2010!!
    1. There may not be provision to correct the PAN, once Form 17 is uploaded and UTN is generated.
    2. Credit for PANNOTAVBL and wrong PAN entries will be subject to TDS returns filed by Deductor and also further, if required, through TDS certificates issued by Deductor.
  4. Existing TDS forms to be renamed and made Annual.
    1. With Finance Bill (2) of 2009 giving the powers to CBDT, to change the periodicity of TDS forms (without amending the act), it is highly expected that, existing TDS forms will be made annual.
    2. Also the rumors state that, the form names are also going to be changed to 24Y, 26Y, etc or something similar!!
    3. The new, yet to be prescribed forms, may also undergo format change, which should get added with UTN, PAN Valid, etc and removed with Section, Surcharge, Cess, etc in Challan details.
    4. However, these returns would continue to be filed at TIN facilitation centers.

Other than these Payment and return related changes, the TDS rates are changed with effect from October 2009 for Rent and Contract payments. Also Surcharge and Cess is not applicable on TDS/TCS, with effect from October 2009.

Keep posted your TDS subject related queries to


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