TDS Form 26Q: Your Complete Guide

For businesses and individuals involved in transactions subject to TDS, understanding the various forms and procedures is essential. Form 26Q is one such important document used for TDS on payments other than salaries.

In this comprehensive guide, we will explore the intricacies of Form 26Q, its significance, and the procedures for filing it accurately and timely.

Understanding Form 26Q:

Form 26Q is a TDS return form primarily used for deducting tax at source on various types of payments, excluding salaries. It is filed quarterly by the deductor to report details of TDS deducted and deposited with the Income Tax Department.

Sections Covered in Form 26Q:

Form 26Q covers a wide range of payment categories subject to TDS. Some of the key sections covered include:

Interest on securities (Section 193)

Dividend (Section 194)

Interest other than Interest on Securities (Section 194A)

Winnings from lotteries and crossword puzzles (Section 194B)

Winnings from horse race (Section 194BB)

Payment of contractor and subcontractor (Section 194C)

Insurance Commission (Section 194D)

Maturity of life insurance policy (Section 194DA)

Payment in respect of deposit under the national savings scheme (Section 194EE)

Payments on account of repurchase of Units by Mutual Funds or UTI 94F (Section 194F)

Commission, prize etc., on sale of lottery tickets (Section 194G)

Commission or Brokerage (Section 194H)

Rent (Section 194I(a)/(b))

Fees for Professional or Technical Services (Section 194J)

Income in respect of units (Section 194K)

Payment of Compensation on acquisition of certain immovable property (Section 194LA)

Certain income from units of a business trust (Section 194LBA)

Income in respect of units of investment fund (Section 194LBB)

Income in respect of investment in securitization trust (Section 194LBC)

Payment of certain amounts in cash (Section 194N)

Payment of certain sums by the e-commerce operator to e-commerce participant (Section 194O)

Details of payment where there is no deduction of tax in certain cases (Section 197A)

Details to be Mentioned in Form 26Q:

The form includes details such as:

- Challan details, including BSR code, date of payment, and total amount.

- Information about the deductor and deductees.

- Reasons for non-deduction or lower deduction of TDS, if applicable.

Due Date of Filing Form 26Q:

Form 26Q must be filed quarterly, with the following due dates:

- April to June quarter: July 31st

- July to September quarter: October 31st

- October to December quarter: January 31st

- January to March quarter: May 31st

Rate of Interest and Penalties:

If TDS is not deducted, a 1% per month interest is charged from the due date of deduction to the actual date of deduction.

Penalties for late filing include:

- Late filing fees under section 234E, which is Rs. 200 per day until the return is filed.

- Penalty under section 271H, ranging from Rs. 10,000 to Rs. 1,00,000, in addition to late filing fees.



However, no penalty under section 271H will be charged if:

- TDS is deposited to the government.

- Late filing fees and interest (if any) are deposited.

- The return is filed before the expiry of 1 year from the due date.

Conclusion:

Form 26Q plays a critical role in the TDS compliance framework, ensuring accurate reporting and timely deposit of taxes deducted at source. By understanding its provisions, taxpayers can avoid penalties and maintain seamless tax operations.

Adhering to the prescribed due dates and diligently filling the form with accurate information is essential for maintaining compliance and fostering a healthy relationship with the tax authorities.