Guidelines for reporting TDS transactions where amount paid to deductee has not exceeded the threshold limit in the first quarter but in subsequent quarters has exceeded threshold limit (as issued by the Directorate of Income Tax – Systems)
1. Flag “Y” should be selected in the field of ‘Reason for non deduction/ lower deduction/higher deduction/ threshold’ to highlight transactions where TDS is not deducted as the threshold for deducting tax has not exceeded.
2. If threshold flag is provided then rate of deduction should be ‘0.0000’ and tax deducted/ deposited (deductee) amount should be ‘0.00’.
3. Threshold flag is can be quoted only against the following section codes in corresponding challan details:
4. 193,194, 194A, 194B, 194BB, 194C, 194D, 194EE, 194G, 194H, 194I, 194J, 194LA
Example:
· In case there is no deduction of tax in the first two quarters of a F.Y., where the prescribed rate of deduction as per Income Tax Rules is 10%, the deductor should report those transactions in the respective quarterly TDS statements with zero rate of deduction (‘0.0000’), zero tax deducted/ deposited (‘0.00’) and amount paid in the respective quarters with threshold flag.
· In the third quarter the threshold limit exceeds, the deductor will mention the prescribed rate of deduction, the amount paid in the third quarter, tax deducted/ deposited (deductee) on the total amount paid till that quarter. The same is represented as follows:
|
PAN |
Rate of |
Amount |
Amount |
Amount |
Reason for non deduction / |
|
Q1 |
|||||
|
PAN1 |
0.0000 |
1,00,000.00 |
0.00 |
0.00 |
Threshold flag 'Y' present |
|
Q2 |
|
|
|
|
|
|
PAN1 |
0.0000 |
1,00,000.00 |
0.00 |
0.00 |
Threshold flag 'Y' present |
|
Q3 |
|
|
|
|
|
|
PAN1 |
30.000 |
1,00,000.00 |
30,000.00 |
30,000.00 |
No flag present |
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