TDS (Tax Deducted at Source) is a mechanism where tax is deducted at the time of making specified payments. Businesses and individuals who deduct TDS are required to file quarterly TDS returns with the Income Tax Department.
Every deductor — whether a company, firm, or individual — must file TDS returns within the prescribed due dates. Failure to file or late filing attracts heavy penalties under Sections 234E and 271H of the Income Tax Act.
TDS return filing is mandatory for employers deducting TDS on salaries, businesses making payments to contractors/vendors, banks deducting TDS on interest, and entities making payments to NRIs.
Who Must File TDS Returns?
- Businesses deducting TDS on salary payments to employees
- Companies/firms making payments to contractors & sub-contractors
- Banks deducting TDS on FD interest above ₹40,000
- Buyers of immovable property above ₹50 Lakhs (Section 194-IA)
- Any person liable to deduct TDS under applicable sections
- Entities collecting TCS (Tax Collected at Source)
Pro Tip: TDS returns are filed quarterly. Even if no TDS was deducted in a quarter, NIL returns must be filed to avoid default notices from the Income Tax Department. Our experts handle NIL returns too at no extra cost.