How to meet Tax obligations

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Who is deductee?

As per the scheme of the Income Tax Act in case of certain prescribed payment (e.g. interest, commission,  brokerage, rent, etc.), the person making the prescribed payments is  required to deduct tax at source from such payments. In such situations, the person making these payments has to pay the net amount after deducting the tax at prescribed rates .He is Known as  deductor and the person receiving the payment  after  deduction at tax  is called the deductee.

Deductee should furnish his permanent account number (PAN) to  deductor?

Every deductee should obtain a valid PAN (if not obtained) and should furnish the correct PAN to the deductor. If incorrect PAN is provided, then the tax deducted may be credited to incorrect account. There are penalty provisons for quoting wrong PAN hence you should ensure that PAN no. is correct.

Deductee to furnish the certificate at lower  deduction or Form No. 15G/I5H well in advance?( 15 H is submitted by Sr. Cit. )

If any deductee has obtained lower deduction certiﬁcate from the Assessing Officer or wants to furnish Form No. 15G/15H  for non-deduction at tax in prescribed case. then he should furnish the certiﬁcate/Form to the deductor well in advance.

Deductee to obtain and preserve TDS certificate issued by the deductor?

Every deductee shall preserve the TDS certiﬁcate issued by the deductor. TDS certificate in respect of TDS on payment other than salary(form 16A) is issued on quarterly basis and in respect of TDS on salary(form 16) on annual basis. If the TDS certiﬁcate is lost. the deductee can request for duplicate TDS  certificate.

Deductee to cross check the tax credit by viewing Farm 26AS?

The deductee can cross check the TDS credit available in his account by viewing the tax credit status online from Form 26AS  which is an  Annual Tax Statement containing the details of tax deducted by various  deductors. Every deductee should check the tax credit available in his account (i.e. in Form 26AS). This enables him to cross check the TDS details provided to him by the deductar with the TDS details available with  the Government.(how to check form 26AS is available here)

Deductee to communicate the Inconsistency (if any) to the deductor In actual tax deducted and tax credit as per  Farm 26AS

On veriﬁcation of Form No.26AS. if there is any inconsistency between the TDS details as provided by the deductar and TDS details available with  the Government records (i.e. mismatch) then the deductee should intimate the same to  the deductor.

Mismatch in tax credit status at a deductee is because of

Non-quoting of PAN or quoting of Incorrect PAN of the deductee by the Tax deductor in his quarterly TDS statement submitted to the Income  Tax Department.

Mismatch results in :

Tax demand from Income Tax Department/reduction in the amount of refund due to the taxpayer.

Avoid mismatch by

Viewing your Tax Credit Statement (26AS) online and asking the dedector to file ‘Correction Statement‘.

Deductee to claim the correct credit of TDS

The deductee is entitled to claim the credit of tax deducted by the deductor. The deductee should claim the correct amount at TDS as deducted by the deductor.

Deductee to correctly mention the details of TDS In the return of Income

To claim the credit of TDS, the deductee has to mention the details of TDS in his retum et income. Deductee should take due care while mentioning the TDS details in the return of income.if any incorrect detail is provided by  the deductee,then tax credit discrepancy will arise at the time of  processing of the return of income and same can cause problem in processing the  return of the Income.