No filing or late filing of TDS/TCS return can take you into a wholesome of troubles. As the taxation rules suggest, taxpayers come under two penalties in case of non-filing of TDS returns or statements.
The first penal consequence the taxpayer will have to face comes under section 234E (Fee for default in furnishing statements), and the second one falls under section 271H (Penalty for failure to furnish statements).
However, you will have to pay the late filing fee and interest as well in case of late filing.
Here in this article, we are going to discuss all the important aspects of TDS/TCS return. While doing so, we are going to talk about the due dates, penalties, and consequences businesses might have to face in case of no filing, or late filing of TDS or TCS returns.
Before we talk more about the out-turn, let's go through the basic liabilities,
As per the Government notifications here are the due dates of filing TCS/TDS return in different quarters of the any Financial Year are as follows:
As said earlier, you are liable to face certain consequences like late fees, interest on the tax amount, and penalties because of non-filing of TDS or TCS return. Here, we have discussed all the out-turn.
As the section 234E of the Taxation rule suggests, you need to pay a fine of Rs. 200 per day until you file the return. Though the late filing fee applies on an everyday basis, However the maximum penalties for not filling TDS return can not be more than actual TDS liabilities.
e.g., Suppose on a certain quarter you are liable to pay an amount of Rs. 10000 as TDS.
In the above example, suppose the deadline for filing the tax return was 31st July, but you are paying the amount on 5th February. Hence the total no. of days of delay is 189 days. Thus the late fee amount becomes Rs. 200 x 189 = Rs.37800. But as per the rule, you don’t need to pay Rs 37,800 as of late fees. Since the amount has crossed the maximum TDS liabilities of Rs. 10,000 you need to pay Rs. 10,000 only as late fee.
Alongside the late fees, you will have to pay interest calculated on the amount. Follow the table below to get the exact detail.
Non-payment of tax after deduction either in whole or in part1.5% per month*From the date of deduction to the date of payment
* For this calculation, for part of the month, interest is payable for the whole month.
E.g.
You may have to pay the penalty of an equal amount that you have failed to deduct, collect or remit in case of no filing of TDS returns.
As the 276B of the Income Tax Act, 1961 suggests if a person fails to pay deducted TDS to the credit of the Central Government within the due date, he shall be punished with rigorous imprisonment for a term of 3 months to 7 years along with fine.
You need to pay a late fee of Rs. 200 per day for the period from the due date of filing of TDS return till the date of filing of return. as the section 234E lays down. However, the amount will not be more than Rs. 5000.
The assessing officer can impose a fine of Rs. 10000 to Rs. 100000 as a penalty in case of non-filing of TDS return within the due date.
Note: Penalty under section 271H is in addition to the late fee mentioned under section 234E. Alongside, the taxation rule under section 271H also applies in case of incorrect filing of TCS/TDS returns.
Read More: Changes in Income Tax Return Forms for AY 2020-21
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