FORM 26Q | Income Tax 26Q Form Download | Karr Tax
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FORM 26Q: Price List

TDS RETURN FORM 26Q 

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Form 26Q for TDS on deductions other than Salary

Rs. 1499

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FORM 26Q: FAQ

Maximizing Tax Efficiency with TDS Form 26Q

Tax Deducted at Source (TDS) is a crucial mechanism in India's taxation system, aiming to collect tax revenue directly from the source of income. It serves as a financial safeguard to prevent tax evasion and promote revenue collection for the government. TDS deducts a portion of income, such as salary, interest, dividends, or services payments, from the source and remits the deducted tax to the government.

Major Sections Covered

The Indian Income Tax Act provides TDS deduction provisions for various types of payments, ensuring accurate deduction and remittance as follows:

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1.      Section 193 - Interest on Securities

•        TDS Rate: 10%

•        Example: Interest on Government Bonds

2.      Section 194 - Dividends

•        TDS Rate: 10%

•        Example: Dividends from XYZ Company

3.      Section 194A - Interest other than Interest on Securities

•        TDS Rate: 10%

•        Example: Interest on Fixed Deposits

4.      Section 194B - Winnings from Lotteries and Puzzles

•        TDS Rate: 30%

•        Example: Lottery Prize Winnings

5.      Section 194C - Payments to Contractors/sub-contractors against works contract

•        TDS Rate: 1% to 2%

•        Example: Payment to Construction Contractors

6.      Section 194D - Commission from Insurance

•        TDS Rate: 5%

•        Example: Commission to Insurance Agents

7.      Section 194DA - Payments in respect of Life Insurance Policy

•        TDS Rate: 5%

•        Example: Payouts from Life Insurance Policies

8.      Section 194EE - Payments in respect of deposits under National Saving Schemes etc.

•        TDS Rate: 20%

•        Example: Interest on National Saving Certificates

9.      Section 194F - Payments on the repurchase of units of Mutual Fund or UTI schemes

•        TDS Rate: 20%

•        Example: Income from Mutual Fund Repurchases

10.    Section 194G - Commission etc. on sale of lottery tickets

•        TDS Rate: 5%

•        Example: Commission on Lottery Ticket Sales

11.    Section 194H - Commission or Brokerage

•        TDS Rate: 5%

•        Example: Brokerage Commissions

12.    Section 194I - Rent

•        TDS Rate: 10%

•        Example: Rental Income

13.    Section 194J - Fees for Professional or Technical Services

•        TDS Rate: 10%

•        Example: Fees for Professional Services

14.    Section 194K - Income in respect of Units

•        TDS Rate: 10%

•        Example: Income from Investments in Units

15.    Section 194LA - Payment of compensation on acquisition of certain immovable property

•        TDS Rate: 10%

•        Example: Property Acquisition Compensation

16.    Section 194LBA - Certain incomes from units of Business Trust

•        TDS Rate: 10%

•        Example: Income from Business Trust Units

17.    Section 194LBB - Income in respect of units of Investment Fund

•        TDS Rate: 30%

•        Example: Income from Investment Fund Units

18.    Section 194LBC - Income in respect of investment in Securitization Trust

•        TDS Rate: 25%

•        Example: Income from Securitization Trust Investments

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These sections act as the compass for deductors, guiding them to ensure precise TDS deductions.

Compliance with TDS provisions is not just a legal obligation; it's a fundamental aspect of responsible financial management.

 

To meet compliance requirements effectively, let's dive into Form 26Q, the quarterly return that serves as a crucial tool for deductors.

What is Form 26Q?

Form 26Q is the lifeline for resident deductors. It's a comprehensive document that encapsulates an array of payments governed by different sections of the Income Tax Act, including several Annexures, each with its purpose:

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  1. Annexure I - Details of TDS deducted and deposited in the bank.

  2. Annexure I-A - Details of the deductor's challan.

  3. Annexure II - Details of deductees (individuals or businesses from whom TDS is deducted).

  4. Annexure IIA - Breakup of TDS deducted on payments other than salary.

  5. Annexure III - Summary of TDS deducted on interest, dividends, and other sums.

Navigating the TDS Calendar: Due Dates Matter

Form 26Q is a quarterly ritual, and the due dates are tied to the respective quarters of the fiscal year.

•        April-June quarter: Due date - 31st July.

•        July-September quarter: Due date - 31st October.

•        October-December quarter: Due date - 31st January.

•        January-March quarter: Due date - 31st May.

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Meeting these deadlines is imperative for deductors to avoid penalties and late fees.

Interest on TDS: Balancing the Financial Equation

Interest becomes a significant factor in cases of non-deduction or non-payment of TDS:

•        Interest for non-deduction of TDS: A penalty of 1% per month accrues from the due date of deduction to the actual date of deduction.

•        Interest for non-payment of TDS: A steeper penalty of 1.5% per month applies if TDS is deducted but not remitted promptly.

The Sting of Late Fees

Late fees can take a toll if Form 26Q isn't filed within the stipulated due date.

•        Late fee: Rs. 200 per day.

•        Maximum late fee: The total TDS amount for which Form 26Q is to be filed.

Avoid late fees by prioritizing the timely filing of Form 26Q by filing electronically on the Tax Information Network (TIN) website.

Stay compliant and optimize your tax journey.

Form 26Q Filing Guide with Example

Here's a step-by-step guide on how to fill out Form 26Q:

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Step 1: Deductor's Details

  • Fill in Deductor's Name, Address, and TAN.

  • Mention the Financial Year.

  • ​

Step 2: Challan Info (Annexure I-A)

  • Include BSR code, Challan serial, and deposit details.

  • ​

Step 3: Deductee Info (Annexure II)

  • Provide PAN, Name, and Address of Deductees.

  • Specify TDS amount and date for each.

  • ​

Step 4: TDS Breakdown (Annexure IIA)

  • Detail payment type, Income Tax section, and TDS rates.

  • Input payment amount and TDS deducted.

  • ​

Step 5: TDS Summary (Annexure III)

  • Summarize TDS deductions on interest, dividends, and more.

  • Include total TDS amounts.

  • ​

Example:

Let's say you are a company (deductor) that has deducted TDS from interest payments to individuals and businesses (deductees) during the financial year 2022-23. You have deposited the TDS in a bank using challan number 123456 on June 30, 2023. XYZ Ltd. deducts TDS on interest payments in FY 2022-23, depositing Rs. 50,000 via Challan 123456 on June 30, 2023.

 

Deductor Details (Header)

Name of Deductor : XYZ Ltd.

Address : 123 Main Street, City

TAN :ABCDE1234F

Financial Year :2022-23

 

Challan Details (Annexure I-A)

BSR Code :12345678

Challan Serial Number :123456

Challan Tender Date :30/06/2023

Total Amount Deposited : Rs. 50,000

 

Deductee Details (Annexure II)

PAN :                                         Name 

ABUPC1234E                        John Smith Doe

AEDFG5678H                       ABC Corporation

 

Breakup of TDS (Annexure IIA)

Nature of Payment                Section

Interest on FD                        194A

Rent                                         194I

 

Summary of TDS Deductions (Annexure III)

Total TDS Deducted on Interest              Rs. 2,500

Total TDS Deducted on Rent                   Rs. 2,000

Total TDS Deducted (Overall)                  Rs. 4,500

Form 26Q in PDF

Form 26Q is a crucial document for TDS (Tax Deducted at Source) compliance in India. It is used to report and file TDS returns by entities deducting tax on payments made to vendors or employees. To download Form 26Q, visit the official income tax website and access the form. Ensure timely filing as per the due date to avoid penalties. This form is essential for maintaining income tax records and complying with Section 194 of the Income Tax Act.

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