TDS stands for Tax Deducted at source, It is one of the most important factors under income tax. Any Person or individual who required to deduct TDS will get TDS Certification after TDS deduction. A TDS certificate is an important document to provide TDS / TCS’ details for various transactions between deductor and deductee It also helps the taxpayer to claim his/her tax credit and the applicable refunds.
It is mandatory for TDS deductor to must have TAN registration, only then he/she can deduct TDS. It is also mandatory for an individual/organization who is engaged in the deduction of TDS to issue TDS Certificate. By the Way at the present time, the TAN registration process is included along with the company registration process.
Types of TDS Certificate
There are only two types of TDS Certificates, named as Quarterly TDS Certificate and Annual TDS Certificate.
Quarterly TDS Certificate
Deduction of TDS on income other than salary is eligible for Quarterly TDS Certificate. It is issued in Form 16A, and TDS would not be applicable if the total income is less than Rs 2 Lakhs 50 thousand. TDS Certificate can be issued for deduction of TDS on interest earned by the depositor on fixed deposits.
Annual TDS Certificate
Annual TDS Certificate is issued by an employer to employees for TDS on salary. The TDS certificate is also known as Form 16A issued by an employer to employees. Form 16 should contain details of TDS deducted by the employer from salary as well as the details of TDS deposited with the Government.
Schedule of issuing TDS Certificate
TDS certificate or form 16A should be issued by employers to the employee within 15 days after filing their TDS return of the fourth quarter. However, the due date for issuing Form 16A is listed below.
● For 1st April to 30th June (1st Quarter) – 15th August
● For 1st July to 30th September (2nd Quarter) – 15th November
● For 1st October to 31st December (3rd Quarter) – 15th February
● For 1st January to 31st March (4th Quarter)– 15th June
The TDS Seductors can also sign the TDS certificate using a digital signature certificate. An unverified signature on a TDS certificate will have a question mark whereas a verified digital signature will have a Check Mark.
Penalty for Not Issuing TDS Certificate If due to any reason a TDS Deductor failed to issue a TDS certificate within 15 days of filing their TDS return via Gen TDS software. Then a penalty of Rs 100 per day for each pending TDS certificate will be charged. But it doesn’t have to exceed up to the TDS amount for the quarter.
Cross-Verification of Details
Form 26AS is like a record of deduction, on the basis of 26AS the TDS certificate will be verified. Data filled in 26AS helps the authority to cross verify the details of the TDS Certificate. In any case of any mismatch, the respective person/ taxpayer has to contact with the detector and approach them for correction or reissuing the TDS certificate.