Detailed procedure for TDS e-payment [Download free checklist]

Hello and welcome. In this post, we will talk about TDS e-payment. We will be covering an overall view of TDS payment and a bit of history of TDS online payment.

If you want, you can jump to the procedure of TDS e-payment or you can indulge a bit and read the entire post.

Let’s us begin.

TDS is a system of deducting tax at the time of making payments. These payments can be salary, rent, interest, commission etc. The person/entity (Deductor) making such payments is responsible for deducting the TDS and paying the balance amount to the other person/entity (Deductee) who is to receive such payment.

Also, it is the duty of the Deductor to pay the tax amount within a certain period of time. The paid amount will go to the “Credit of the Central Government” via Banks.

Modes of TDS Payment: 

There are two ways to make the payment of TDS to the banks:

    1. By cash: Payment of Tax in cash at the counter through any authorized bank
    2. By e-Payment: Payment of Tax through Net-Banking or Debit Card

History of TDS payment:

In 2004, the electronic payment of taxes for income taxpayers came into the picture. In order to expand the idea of e-payment of taxes, it was mandatory for the following categories to pay their taxes electronically:

  • All corporate assessee’s (Companies);
  • All assessee’s (other than Companies), who fall under the purview of section 44AB of Income Tax Act.

The scheme of mandatory electronic payment of taxes for Income Taxpayers was applicable from April 1st, 2008. This was applicable for all payments, irrespective of the assessment year to which it belongs.

Online payment of taxes is applicable for:

  • Advance Tax for Income Tax
  • Self Assessment Tax for Income Tax
  • Tax Deducted at Source
  • Tax Collected at Source
  • Regular Assessment Tax for Income Tax

NSDL offers the gateway for tax-payers to make electronic payment of taxes through the Internet banking facility offered by the authorized banks. They also provide an option to make electronic payment of taxes using debit cards.

Prerequisites for making TDS e-Payment

  1. Valid TAN and PAN
  2. Internet Banking Account
  3. Good internet connection
  4. Sufficient balance in the bank to cover the amount of payment for the immediate transfer

Note: Consider the following points before making the payment. 

Steps by step procedure to make TDS payment

  1. Accumulate the total of deducted TDS amount for the month.
  2. Calculate interest [if any] with respect to the applicability of interest.
  3. Visit “www.tin-nsdl.com
  4. Next, Goto “Service ->”e-payment: Pay Taxes Online option
  5. Then, Select on Challan No./ITNS 281.
  6. Now, enter the relevant challan details;
    • Tax Applicable from Companies or Non-Companies
    • Enter Valid TAN
    • Select the Assessment Year [Choose proper Assessment Year. Eg: for making the payment towards TDS / TCS of FY 2017-18, select assessment year 2018-19]
    • Address of TAN holder with City / District, State & Pin Code being mandatory
    • Email Id & Mobile No.[if required]
    • Type of Payment [Regular Payment – (200) TDS / TCS payable by Taxpayer & Payment on ITD assessment – (400) TDS / TCS Regular Assessment]
    • Nature of Payment – Select the applicable section from the drop-down
    • Mode of Payment – Select the mode for payment i.e Net-Banking or Debit Card (of selected banks)
  7. Enter the Code shown and click on Proceed to submit data entered. Now, a confirmation screen will be displayed. If the taxpayer confirms the data entered in the challan, it will be re-directed to the Net-Banking/Debit Card payment site of the selected bank. If data needs editing, the user can do the same by clicking ‘Edit’.
  8. At the Net-Banking site, the taxpayer should login to the Net-Banking site with the user id & password provided by the bank for net-banking purpose and enter relevant payment details like basic tax, surcharge, cess, interest, penalty etc.. Select the relevant bank account in case of multiple accounts with internet facility for the same login.
  9. Later, at the Debit card payment site, the taxpayer should enter the debit card details like debit card number, validity information, cardholder name & ATM Pin.
  10. On successful payment, a Challan counterfoil will be displayed containing CIN, payment details and bank name through which e-payment has been made. This counterfoil is proof of payment being made. Print and save the Counter Foil.

Note

  • Government deductors can make the payment through Transfer Voucher to the treasury
  • Do not make any mistake while doing the payment. Particularly in mentioning TAN. Quoting false TAN may attract a penalty of Rs. 10,000/- as per section 272BB and also non-credit of tax amount to the TAN.
  • Separate payment has to be made for individual challan.
  • BSR code on e-Payment necessarily would not be of the branch, where you hold the account. So verify the Counterfoil for right BSR code an branch name.
  • While filling up the challan, the selection is of assessment year and not the Financial year. [Consequence further on wrong selection is that users should go to AO or the TDS commissioner to get it right]
  • Click here to see the list of Banks authorized to collect TDS payment
  • Click here to search for Authorised Bank branch for Payment of TDS near your location

The due date for payment:

  • Government: The same day as the deduction.
  • Non-Government: Within next month 7th, from the date of deduction.

For more details on due dates for TDS payments, then click here.

Interest Applicability:

  • If there is a delay in payment due to late deduction, then interest is applicable at 1% per month, starting from the supposed month of supposed deduction to the month of actual deduction.
  • If there is a delay in payment after deduction, then interest will be applicable at the rate of 1.5% per month, starting from the month of deduction to the month of payment.

Download the e-payment checklist here. 

Share On:

Leave a Reply