TAX

DEDUCTED
AT SOURCE (
TDS )
SUBMITTED BY –
SUBMITTED TO-
 WHAT IS TDS?
• tax deducted at source is a system introduced by income tax
department, where the person responsible for making specified
payments such as salary , commission ,professional
fees ,interest, rent, etc. is liable to deduct a certain percentage 
of tax before making payments. as the name suggest, the
concept of TDS is to deduct tax at its source.  let us take an
example of TDS assuming the nature of payment is
professional fees on which the specified rate is 10%.
• XYZ ltd. Makes a payment of RS 50000/- towards professionals
fees to MR. ABC, then XYZ ltd. Shall deduct a tax of RS 5000/-
and make a net payment of RS 45000/- (50000/- deducted by
RS 5000/-) to MR. ABC. The amount  of 5000/- deducted by
XYZ ltd. Will be directly deposited by XYZ ltd  to the credit of
the government.
 Tax deducted at source

Tax deducted on some payment

Under income TDS is deducted, Applicable on It is deducted on

tax not added services(not goods) payments
WHO IS SUPPOSED TO DEDUCT
TAX AT SOURCE AND WHEN?
• Any person who is responsible for making payment of nature covered under the TDS
provision of income tax act ,1961 shall be liable to deduct tax at source. But no TDS
has to deducted if a person making the payment is an individual or HUF whose books
are not required to be audited.
• However, just in case of rent payments made by individuals and HUF exceeding RS
50000 per month ,are required to deduct TDS @5% although the individual or HUF is
not liable for a tax audit. Also, such individual and HUF liable to deduct TDS@ 5%
need not apply for tan.
• Employer deducts TDS at the income tax slab rates applicable on salary of employees.
• Banks deduct TDS on interest income @10% if PAN is provided,but in case of no PAN
is provided, but in case of no PAN may deduct @20%. You can submit form 15G and
Form 15H to the bank if your total income is below taxable limit in order that they
don’t deduct TDS on your interest income.
 TDS
RATES 
 WHEN TDS NEEDS  TO
DEPOSIT TO GOVT.?
particular Payment mode Due date for paying
TDS

Government office Without challan Same day

Government office With challan 7th of next month

Government office Prerequisite opt to be 7th of next month

deposited the bye
employer

other For the month of march 30th April

7th of next month

Or other month
 TDS is not deducted on reimbursement of
expenses like travelling expenses,
management expense ,etc.
THERE ARE
 interest earned from recurring deposits or
SOME CASE saving account opened in co-operative
WHERE TDS societies.
IS NOT  payment to government /RBI/Statutory
DEDUCTED corporation etc.
SUCH AS:-  on certificate issued by ITO u/s 197
 interest earned on Indian Vikas Patra
scheme
WHAT ARE THE TDS RETURNS AND THEIR
DUE DATES?
 FORM 24Q FOR SALARIES
 FORM 26Q FOR OTHER THAN SALARIES
 FORM 26QB FOR SECTION 194(IA)
 FORM 26QC FOR SECTION 194 (IB)
 FORM 26QD FOR SECTION 194 (M)
 FORM 27Q FOR NON-RESIDENT
 FORM 27EQ FOR TCS

This Photo by Unknown Author is licensed under CC BY-ND

THE DUE DATES
FOR QUARTERLY QUARTER
QUARTER
PERIOD
DUE DATE TO
FILE TDS RETURN
FILING OF TDS
RETURNS ARE AS 1ST
QUARTER
APRIL TO
JUNE
ON 31ST JULY OF
THE SAME F.Y.
FOLLOWS:
2ND JULY TO ON 31ST OCT OF
QUARTER SEPTEMBER THE SAME F.Y.

3RD OCTOBER TO ON31ST JAN OF

QUARTER DECEMBER THE SAME F.Y.

4TH JANUARY TO ON 31ST MAY OF

QUARTER MARCH THE NEXT F.Y.
LATE FILING OF RETURN OF TDS

• IF THE DEDUCTOR FAILS TO FURNISH THE TDS RETURN ON OR

BEFORE THE SPECIFIED DUE DATE ,HE SHALL BE LIABLE TO PAY
PENALTY UNDER SECTION 234E OF ₹200 PER DAY TILL THE DATE
OF DEFAULT SUBJECT TO THE MAXIMUM AMOUNT OF TDS IS
LIEVED.
 HOW TDS WORK IN
TALLY?
FIRST WE HAVE TO ENABLE TDS
1) GOT--- F11---ENABLE TDS YES
2) create TDS nature of payment
(rule) CREATE LEDGERS
*CREATE EXPENSE LEDGER USE TDS
HERE
* CREATE TDS ON EXPENSE LEDGER
AND ENABLE TDS HERE
*CREATE PARTY LEDGER AND
ENABLE TDS HERE Create voucher entries
1) Journal vouchers for tds deduction
entry
2) Payment voucher for payment to
party or government