TDS (Tax Deducted at Source) is a critical part of your business’s compliance responsibility. Yet, many SMEs make avoidable mistakes that can lead to penalties, interest charges, and notices from the tax department. In this blog, we highlight the most common errors in TDS return filing and how to stay compliant with confidence.
Missing or Delayed TDS Payments
TDS must be deposited by the 7th of the following month for April to February months while TDS for March is due by April 30th. Delays lead to interest @1.5% per month and late filing fees. Always set calendar alerts or automate this via accounting software.
Incorrect PAN or Mismatch in Details
A wrong or missing PAN can lead to deduction at a higher rate of 20%. Always verify PAN details before filing.
Wrong Challan Number or Incorrect Mapping
Linking the wrong challan to the wrong deductee can result in mismatch and notices. Always reconcile before final submission.
Not Filing NIL TDS Return When Applicable
Even if no TDS was deducted, a NIL return (Declaration for Non-Filing of TDS statement) may be mandatory if a TAN exists. Missing this can trigger non-compliance tags.
Delay in Filing Quarterly Returns
TDS returns (Form 24Q, 26Q, etc.) are to be filed quarterly. Delayed returns attract late fees under section 234E.
Best Practices for TDS Compliance
– Use reconciliation reports to match challans and deductees
– Validate PANs using the income tax portal tools
– Automate TDS computation with accounting software
– Maintain a monthly calendar of due dates
– Consult your CA regularly for updates
Need help with accurate TDS compliance and return filing? Our team at ATMS & CO LLP helps SMEs stay compliant with all direct tax requirements.
📞 Call us: 022-6267-3333 | 📧 Email: info@atmsco.in
Image By Freepic
Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Please consult a qualified professional for guidance specific to your situation.