Tds non deduction

Firstly if a person doesn't submit pan then tds shall be deducted @ 20 %. Secondly late deduction or non deduction would attract penalty @ 18% p.a. Thirdly late filing of tds return will also attract penalty of rs 200 per day but subject to max amount of tds.( refer section 234E) In my opinion ask the person to apply for pan ( hardly it will take a week to generate pan). Deduct and deposit tds of previous year on current date along with interest and penalty to avoid further mandatory penalty of rs 100000 in case details are not furnished upto one year from the date when it is required to be submitted.

As per CBDT circular No 8 dated 5 October 2012, in case where the salary less 80C deductions is less than the basic exemption limit, no TDS is deductible even if PAN is not available. 

206AA operates only where tax is deductible in the first place.  Section 192 doesn't provide for a TDS rate.  Therefore, where no tax is deductible, 206AA won't operate.

 

Therefore, in your case, nothing is required to be done.  206AA won't apply.

Dear nikhil I think when investment details are not supplied by employee then the tds is deducted at the end of the year. Further the employee is not holding pan. In these circumstances the given income is above exemption limit. If I am wrong please correct me

Naman Bhai,

 

In case investment details are not available, then if total income is more than 2,00,000, then 20% is to be deducted on the whole of the salary ie if you earn Rs 2.40 lakhs and no investment details are provided, then Rs 48,000 shall be deducted.

very TRUE, Now the deducted amount is to be deposited with interest. Practicaly this problem can be resolved by claiming some deductions

As salary of the person is 2,40,000. 1% interest p.m. for the late deduction will be charged on 2,40,000 or 40,000 or 4000 or 4120... for the financial year 2012-13??

the interest for late deduction is charged on monthly basis:

 

if the monthly salary is Rs 20,000, then TDS to be deducted is Rs 4,000 pm and interest chargeable thereon.

As posted by Mr. Naman Singla to  ask the person to apply for pan ( hardly it will take a week to generate pan). Deduct and deposit TDS of previous year on current date along with interest and penalty. In that case if noe the person shows his PAN Card and at that time how much TDS to be deducted if lets say the person is having salary of Rs.2,40,000 in financial year 2012-13 ?

 

Nd Nikhil bro as per your advise lets say if a person is 15000 pm salary and suddenly between the financial year his salary got increased i.e Rs.2,40,000 yearly and the salaried person give acknowledgement that he is having tax saving investment and ask not to deduct TDS as his salary is below the exemption limit i.e. 2,00,000+1,00,000 (under 80C) and he is having savings. He gives written acknowledgment but doesn't show any saving and office also doesn't ask to him as he gived a written acknowledgement. Then what will be result under these circumstances?

ask the person to apply for pan ( hardly it will take a week to generate pan). Deduct and deposit tds of previous year on current date along with interest and penalty

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