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With effect from 1st January 2014, all corporate and government deductors and other assesses, who are subject to compulsory audit under Section 44AB, are required to use electronic transfer to make TDS payment. To avail of this facility the taxpayer is required to have a net-banking account with an authorized bank/s. T list is available on the NSDL- TIN website.
Online TDS payment or E-payment is a simple and user friendly process. It can be done by following the below mentioned steps-
  • Visit the E-Payment Income Tax Department Website.  (https://onlineservices.tin.egov-nsdl.com/)
  • Select the challan no. ITNS 281. This challan number is to be used for depositing TDS/TCS by company or non-company deductee.
  • Select the type of deductee. If deductee is a person other than company, then you should select (0021) Non-Company Deductee, else you need to select (0020) Company Deductee.
  • Enter your TAN details. This will be used for an online verification on the validity of the TAN. If the TAN details are not available in the database of the Income Tax authorities, then you will not be allowed to proceed any further.
  • Select the Assessment Year (AY). The Assessment Year is the year immediately following the financial year in which the income is evaluated. For example, for income earned between 1 April 2015 and 31 March 2016, the assessment year will be 2016-17.
  • Enter other challan details like accounting head under which the payment is to be made. The name, address, email address and contact details of TAN Holder need to be furnished.
  • Select the type of the payment. If it is a normal payment, then select (200) TDS/TCS Payable by Taxpayer or if it is a payment against the demand raised by the I.T. Department  e.g. payment of interest or late fee under section 234E then select (400) TDS/TCS Regular Assessment (Raised by I.T. Department)
  • Select the nature of payment such as payment of insurance commission, rent, fees for professional services, etc.
  • Also, you will need to select the bank through which the TDS will be deposited.
  • On submission of the data, a confirmation screen would get displayed. After checking it thoroughly, you need to confirm that all the data entered in the challan has been entered correctly and true to your knowledge.
  • Post your confirmation, the page will be re-directed to the net-banking page of your bank.
  • You are now required to login to the net banking page, using the User ID and password and make the payment.
  • After a successful online TDS payment, the system will display a challan counterfoil. The challan will contain CIN – Challan Identification Number. It will also show the payment details, bank name through which the e-payment has been made, Bank Branch Code (BSR) and date of tender of challan. Many people prefer to save a copy of the challan counterfoil as it is proof of the payment being made. In case, you misplace the same, banks also provide the facility for re-generation of the electronic challan counterfoil.
 The collecting bank branch will transmit the details of taxes deposited by you to the “Tax Information Network” (TIN) through the Online Tax Accounting System (OLTAS). You can also verify the status of the challan in the ‘Challan Status Inquiry” on the NSDL – TIN website, post seven days of making the payment using the CIN.
 
 TDS Certificate
After depositing the TDS with the Income Tax Department, as per Section 203, the deductor is required to issue a TDS Certificate to the person on behalf of whom the tax payment was made. The TDS Certificate or Form 16 / Form 16A (as applicable) should be issued on an annual or quarterly basis.

Benefits of Online Payment of  TDS

  • Payment facility is available 24 x 7.
  • TDS payment can be done by the deductor as their convenience in terms of location and time.
  • Immediate acknowledgement of the payment.
  • The Challan acknowledgement copies can be downloaded and saved for future reference.
  • Reduced charges of corruption and malpractices such as discretionary grant credit of tax deductions based on manual TDS Certificates.
  • Less paper translates into being environment friendly.
Timelines for TDS Payment
  • The due date for the payment of TDS that has been collected by the deductor is 7th of the next month. For example, the deductor has to pay the TDS for the month of May, on or before 7th June.
  • Only for the month of March, considering it is the end of the financial year, it is allowed to pay the deducted TDS on or before 30th April of that year. These timelines are applicable to all deductors i.e. non-Government assesses and also to Government assesses, who deposit tax with Challan (Treasury Challan)
  • For government deductors who make the TDS payment without challan, the due date for payment of TDS is the same day on which the tax amount is deducted.
  • In some circumstances, the Assessing officer (AO), with prior approval from the Joint Commissioner, may allow the quarterly payment of TDS. In that case, last date of payment is 7th of the next month after end of each quarter and 30th April for the last quarter of the financial year.

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