Excess amount of TDS deducted

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If you've accidentally deducted TDS at a higher rate (10% under Section 194C) than required (1%), you have a couple of options for filing your TDS return. If you've already paid the challan for the higher amount, you can file the return showing the correct base amount but the higher TDS amount. Alternatively, if the challan hasn't been paid, you might be able to adjust the excess TDS in a future payment to the same creditor, or if it's a one-off transaction, proceed with paying the higher TDS and noting it as an excess deduction.

pranab sarma

pranab sarma (Querist)
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26 July 2020 By mistake I have deducted TDS @ 10% u/s 194C which actually should be 1% . Now I am preparing TDS return where section and rate to be mentioned . Now what to do ? please suggest and thanks ..

Barkha Govind Bagdiya

Barkha Govind Bagdiya (Expert)
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26 July 2020 Hello, there are two options available.

A. If you have paid challan for 10% TDS - In this case, go ahead to file TDS return with 10% TDS amount. Enter correct amount on which TDS deducted and enter 10% TDS amount.

B. If you have not paid challan for 10% TDS -
1. You may adjust excess TDS of 9% in next payment to creditor if you expect the creditor to be continuing. And file TDS return with 1% TDS normally.

2. If creditor is one time and no future transaction is expected with creditor, then pay the 10% TDS and show it as excess deducted in TDS return as explained in option A.

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