TDS Return Filing and Correction in Bangalore

TDS is unforgiving of small errors. A single wrong PAN or a challan booked to the wrong section can trigger a short-deduction default, lock up a deductee's credit, and grow a ₹200-a-day fee while no one is watching. TDS return filing and correction is one of the things Krishna & Associates is known for — we have handled more than 80 TDS cases, many of them messy legacy defaults that other advisors had given up on. This page sets out the framework and the dates for FY 2025-26.

The TDS Obligation

The Income Tax Act requires specified payers to deduct tax at source under provisions running from Section 192 (salary) through to Section 195 (payments to non-residents). The deductor must hold a TAN, deduct at the correct rate, deposit the tax on time, file a quarterly statement, and issue the deduction certificate to the deductee.

Payment and Return Due Dates

Tax deducted from April to February is payable by the 7th of the following month; tax deducted in March is payable by 30 April. Quarterly statements are then filed in Form 24Q (salary), 26Q (non-salary payments to residents), 27Q (payments to non-residents) and 27EQ (TCS).

TDS Rates for FY 2025-26

Rates and thresholds shift more often than most payers track. Among the recent changes: commission and brokerage under Section 194H is now 2% (reduced from 5% w.e.f. 1 October 2024) with the threshold raised to ₹20,000 per annum from 1 April 2025; rent under Section 194-I remains 2% on plant and machinery and 10% on land and building, with the annual threshold enhanced to ₹6,00,000 from 1 April 2025; professional and technical fees under Section 194J attract 10% (2% for technical services) with the threshold raised to ₹50,000; and contractor payments under Section 194C remain 1% (individual/HUF) or 2% (others).

Property Transactions — Section 194-IA

A buyer of immovable property valued at ₹50 lakh or more must deduct 1% and file Form 26QB within 30 days from the end of the month of deduction, then issue Form 16B to the seller. Each instalment in an under-construction purchase needs its own 26QB, and a missed one is a common, avoidable default.

Correction Statements and Defaults

When TRACES flags a default, we download the justification report and conso file, identify whether it is a short deduction, short payment, late deduction or late payment, and file a correction statement to fix the PAN, challan or amount. The aim is not just to clear the current default but to stop it recurring next quarter.

Lower / NIL Deduction Certificates

Where a deductee's actual tax liability is lower than the standard TDS rate, a certificate under Section 197 (applied for in Form 13) allows payments to be received at a lower or nil rate — valuable for businesses that would otherwise see working capital locked up as refundable TDS.

Certificates and Penalties

Deductors must issue Form 16 (salary), Form 16A (other payments) and Form 16B (property). The cost of getting TDS wrong is steep: a Section 234E late-filing fee of ₹200 per day (capped at the TDS amount), a penalty of ₹10,000–₹1,00,000 under Section 271H, and interest under Section 201(1A) of 1% per month for non-deduction and 1.5% per month for deducted-but-unpaid tax. These dovetail with your income tax return, where the same credits must reconcile.