TDS and TCS Both Deducted

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10 Points Joined December 2020

Unknowingly the Buyer deducted TDS and the Seller Also Collected TCS . What to do with these kinds of transactions?

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On 25 April 2025 at 06:15 Report
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Master in Accounts & high court Advocate
9434 Points Joined December 2011

Handling Duplicate TDS and TCS If the buyer deducted TDS and the seller also collected TCS on the same transaction, it may lead to duplicate tax compliance. Here's what you can do:

Step 1: Verify the Transaction - *Check Invoices and Documents*: Verify the invoices, receipts, and other documents to ensure that both TDS and TCS were indeed deducted/collected. 

Step 2: Claim Refund or Adjustment - *Claim Refund*: If you're the seller, you can claim a refund for the excess tax paid (TCS - TDS). File a rectification return or claim a refund in your income tax return. - *Adjust in Next Transaction*: If possible, you can also adjust the excess tax paid in your next transaction.

 Step 3: Communicate with the Buyer - *Inform the Buyer*: Inform the buyer about the duplicate tax compliance and request them to adjust the TDS in their next transaction or claim a refund.

 Step 4: Consult a Tax Professional -

*Seek Professional Help*: Consult a tax professional to ensure you're following the correct procedure and to avoid any potential penalties or fines. Key Points - 

*Rectification Returns*: File rectification returns to correct any errors in tax compliance. - *Refund Claims*: Claim refunds for excess tax paid. -

 *Communication*: Communicate with the buyer to avoid duplicate tax compliance in future transactions

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On 28 April 2025 at 14:15


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