regarding tds

166 views 3 replies

Soujanya Vemula

13 Points Joined February 2019

Is it compulsory to deduct tds for customers u/s 194A by the bank...if the customer not submitted form 15G/H...and bank not deducted tds ...then wt are the consequences to bank????

Replies (3)

Fareeha Jabeen

Articled Assistant

160 Points Joined June 2018

Hello Soujanya,

As per section 194A, the TDS needs to be deducted on interest on deposits if the total interest credited to the customer in a year is more than Rs.10,000/-. However, no TDS needs to be deducted if the interest does not exceed the limit or if he/she has submitted form 15G/H.

If the bank has not deducted TDS when the interest paid is more than Rs.10,000/- and the customer has also not submitted Form 15G/H, then they need to deduct it in the next month and deposit the amount alongwith interest on TDS as per the rules mentioned here

I strongly recommend you to deduct and pay the TDS on time or as early as possible to avoid increasing interest on TDS and delay in filing of returns.

Have a nice day!

Pankti Joshee

student

308 Points Joined March 2019

A deductor would face the following consequences if he fails to deduct TDS or after deducting the same fails to deposit to the credit of Central Government’s account:-

a) Disallowance of expenditure

as per section 40(a)(ia), any sum payable to a resident, which is subject to deduction of tax at source, would attract 30% disallowance if it is paid without deduction of tax at source or if tax is deducted but is not deposited with the Central Government till the due date of filing of return.