E Tds Return Filing Interview Questions & Answers

  1. Question 1. Who Is Required To File E-tds / E-tcs Statement?

    Answer :

    As per Income Tax Act, 1961, all corporate and government deductors / collectors are mandatorily required to file their TDS / TCS statements on electronic media (i.e. e-TDS / TCS statements). However, deductors / collectors other than corporate / government can file either in physical or in electronic form.

  2. Question 2. What Will Be The Consequences If I Do Not File Tds / Tcs Statement Within Due Date?

    Answer :

    There will be a levy of Rs. 200.00 per day under section 234E of the IT Act, 1961 from the due date till the date when statement is filed.

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  4. Question 3. Is There Any Penalty For Non-filing Of Tds / Tcs Statements?

    Answer :

    Yes. If TDS / TCS statement is not filed for one year from the due date of filing, there would be a penalty of minimum Rs. 10,000.00 to Rs. 1,00,000.00 for not filing TDS / TCS statement under section 271H of the IT Act, 1961.

  5. Question 4. What Are The Different Statuses Available On Traces Regarding Tds / Tcs Statement?

    Answer :

    Following processing status shall be displayed for regular statement:

    1. Pending for Processing
    2. Processed for Form 26AS
    3. Processed without Defaults
    4. Processed with Defaults 

     Following processing status shall be displayed for correction statement:

    1. Pending for Processing
    2. Processed for Form 26AS
    3. Processed without Defaults
    4. Processed with Defaults
    5. Rejected
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  7. Question 5. What Are The Common Reasons For Rejection Of Correction Statement By Tds-cpc?

    Answer :

    Following are the common reasons for rejecting a correction statement:

    TAN is not valid as per data at TDS CPC

    Statement corresponding to regular token number / previous token number field, as given in correction return, does not exist

    Previous token number does not correspond to the last accepted correction statement at TDS CPC

    Correction is filed for a regular return which is in cancelled state

    In a correction statement, below are the verification keys which should match with the corresponding fields of regular statement:

    1. RRR assessment year
    2. Return Financial Year
    3. Periodicity
    4. Previous Token number
    5. Last TAN of Deductor
    6. Receipt number of Original / Regular Return
    7. Form number

    Sum given in 27A form should match with the sum of deducted amount of deductee records given in the correction statement 

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  9. Question 6. What Are The Reasons To Reject The Correction In Deductee Records By Tds-cpc?

    Answer :

    Rejection reasons pertaining to deductee details are as follows:

    1. In a correction statement that updates / deletes deductee rows, verification keys from deductee data that should match with corresponding fields in regular / previous return are – Last PAN, Last total amount deducted at source, Last total amount deposited 
    2. Updation / deletion on deductee record is submitted in a correction statement but this deductee record does not exist in previous/ regular return
    3. Valid PAN to invalid PAN update is not allowed for a deductee row
    4. Deductee detail record number should be unique in case of addition of deductees
    5. If value of Reason for non-deduction / lower deduction / higher deduction / threshold field as per regular or last correction statement is ‘C’ , then update can be performed only on ‘PAN’, ‘Amount of Payment’ and ‘Date of Payment’
    6. Deletion of deductee record having value C in Reason for non-deduction / lower deduction/ higher deduction / threshold field, is not allowed
    7. Valid PAN to another valid PAN update can be done only once for a given deductee row 
  10. Question 7. What Are The Reasons To Reject The Correction In Salary Detail Records By Tds-cpc?

    Answer :

    Rejection reasons pertaining to salary details are as follows:

    1. In case of salary detail PAN update or delete of salary detail record, last total gross income should match with corresponding value in regular / previous statement
    2. Salary detail record on which correction is filed does not exist in the regular / previous return
    3. In case of addition of salary detail record, the record number should be unique and in sequence with the existing records in regular / previous return
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  12. Question 8. What Is Annual E-tds/tcs Return?

    Answer :

    Annual e-TDS/TCS return is the TDS return under section 206 of the Income Tax Act (prepared in Form Nos. 24, 26 or 27) or TCS return under section 206C of the Income Tax Act (prepared in Form No. 27E), which is prepared in electronic media as per prescribed data structure. Such returns furnished in a CD/Pen Drive should be accompanied by a signed verification in Form No. 27A in case of Annual TDS returns or Form No. 27B in case of Annual TCS return

  13. Question 9. What Is Quarterly E-tds/tcs Statement?

    Answer :

    TDS/TCS returns filed in electronic form as per section 200(3)/206C, as amended by Finance Act, 2005, are quarterly TDS/TCS statements. As per the Income Tax Act, these quarterly statements are required to be furnished from FY 2005-06 onwards. The forms used for quarterly e-TDS statements are Form Nos. 24Q, 26Q and 27Q and for quarterly e-TCS statement is Form No. 27EQ. These statements filed in CD/Pen Drive should be accompanied by a signed verification in Form No. 27A in case of both e-TDS/TCS statements.

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  15. Question 10. Who Is Required To File E-tds/tcs Return?

    Answer :

    As per Income Tax Act, 1961, all corporate and government deductors/ collectors are compulsorily required to file their TDS/TCS returns on electronic media (i.e. e-TDS/TCS returns). However, deductors/collectors other than corporate/government can file either in physical or in electronic form.

  16. Question 11. E-tds/tcs Returns Have Been Made Mandatory For Government Deductors. How Do I Know Whether I Am A Government Deductor Or Not?

    Answer :

    All Drawing and Disbursing Officers of Central and State Governments come under the category of Government deductors.

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  18. Question 12. Under What Provision Should E-tds/tcs Returns Be Filed?

    Answer :

    An e-TDS return should be filed under Section 206 of the Income Tax Act in accordance with the scheme dated August 26, 2003 for electronic filing of TDS return notified by the Central Board of Direct Taxes (CBDT) for this purpose. CBDT Circular No. 8 dated September 19, 2003 may also be referred.

    An e-TCS return should be filed under Section 206C of the Income Tax Act in accordance with the scheme dated March 30, 2005 for electronic filing of TCS return notified by the CBDT for this purpose.

    As per section 200(3)/206C, as amended by Finance Act 2005, deductors/ collectors are required to file quarterly TDS/TCS statements from FY 2005- 06 onwards.

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  20. Question 13. Who Is The E-filing Administrator?

    Answer :

    CBDT has appointed the Director General of Income Tax (Systems) as e-Filing Administrator for the purpose of electronic filing of TDS/TCS returns.

  21. Question 14. Who Is An E-tds/tcs Intermediary?

    Answer :

    BDT has appointed National Securities Depository Limited, (NSDL), Mumbai, as e-TDS/TCS Intermediary. NSDL has established TIN Facilitation Centres (TIN-FCs) across the country to facilitate deductors/ collectors file their e-TDS/TCS returns.

  22. Question 15. Is There Any Software Available For Preparation Of E-tds/tcs Return?

    Answer :

    NSDL has made available a freely downloadable return preparation utility for preparation of e-TDS/TCS returns. Additionally, you can develop your own software for this purpose or you may acquire software from various third party vendors. A list of vendors, who have informed NSDL that they have developed software for preparing e-TDS/TCS returns, is available on the NSDL-TIN website.

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  24. Question 16. Are The Forms Used For E-tds/tcs Return Same As For Physical Returns?

    Answer :

    Forms for filing TDS/TCS returns were notified by CBDT. These forms are same for electronic and physical returns. However, e-TDS/TCS return is to be prepared as a clean text ASCII file in accordance with the specified data structure (file format) prescribed by ITD.

  25. Question 17. What Is Challan Serial Number Given By The Bank?

    Answer :

    Bank Challan Number is a receipt number given by the bank branch where TDS is deposited. A separate receipt number is given for each challan deposited. You are required to mention this challan number in the e-TDS/TCS return and not the preprinted numbers on the bank challan form i.e. ITNS 269 or ITNS 271.

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  27. Question 18. What Is ‘bank Branch Code’? Where Do I Get It From?

    Answer :

    Reserve Bank of India has allocated a unique seven-digit code to each bank branch. You are required to mention the code of the bank branch where TDS is deposited in the e-TDS/TCS return. You can get this code from the bank branch where TDS amount is deposited.

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  29. Question 19. Is It Mandatory To Mention Tax Deduction Account Number (tan) In E-tds/tcs Return?

    Answer :

    Yes, it is mandatory to mention the 10 digit reformatted (new) TAN in your e-TDS/TCS return.

  30. Question 20. What Should I Mention In The Field ‘paid By Book Entry Or Otherwise’ In Deduction Details?

    Answer :

    If payment to the parties (on which TDS has been deducted) has been made actually i.e. by cash, cheque, demand draft or any other acceptable mode, then ‘otherwise’ has to be mentioned in the specified field. But if payment has not been actually made and merely a provision has been made on the last date of the accounting year, then the option ‘Paid by Book Entry’ has to be selected.

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  32. Question 21. By Whom Should The Control Chart Form 27a Be Signed?

    Answer :

    Form 27A is the summary of the TDS/TCS statement. It has to be signed by the same person who is authorized to sign the TDS/TCS statement in paper format.

  33. Question 22. What If E-tds/tcs Return Does Not Contain Pans Of All Deductees?

    Answer :

    In case PANs of some of the deductees are not mentioned in the e-TDS/ TCS return, the Provisional Receipt will mention the count of missing PANs in the e-TDS/TCS return. The details of missing PANs (to the extent it can be collected from the deductees) may be filed within seven days of the date of Provisional Receipt to TIN-FC. e-TDS/TCS return will be accepted even with missing PANs. However, if PAN of deductees is not given in the TDS return, tax deducted from payment made to him cannot be posted to the statement of TDS to be issued to him u/s 203AA.

  34. Question 23. Is The Challan Identification Number Compulsory?

    Answer :

    Yes. Challan Identification Number is necessary for all non-Government deductors.

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  36. Question 24. Is Pan Mandatory For Deductors And Employees/deductees?

    Answer :

    PAN of the deductors has to be given by non-Government deductors. It is essential to quote PAN of all deductees failing which credit of tax deducted will not be given.

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  38. Question 25. After I Prepare My E-tds/tcs Return, Is There Any Way I Can Check/ Verify Whether It Conforms To The Prescribed Data Structure (file Format)?

    Answer :

    Yes, after you have prepared your e-TDS/TCS return you can check/verify the same by using the File Validation Utility (FVU). 

  39. Question 26. What Is File Validation Utility (fvu)?

    Answer :

    FVU is a program developed by NSDL, which is used to ascertain whether the e-TDS/TCS return file contains any format level error(s). When you pass e-TDS/TCS return through FVU, it generates an ‘error/response file’. If there are no errors in the e-TDS/TCS return file, error/response file will display the control totals. If there are errors, the error/response file will display the error location and error code along with the error code description. In case you find any error, you can rectify the error and pass the e-TDS/TCS return file again through the FVU till you get an error-free file.

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  41. Question 27. What Is The ‘upload File’ In The New File Validation Utility?

    Answer :

    Earlier the e-TDS/TCS return file after validating using File Validation Utility (FVU) had to be filed with TIN-FC. Now ‘Upload File’ that is generated by the FVU when the return is validated using the FVU has to be filed with TIN-FC. This ‘upload file’ is a file with the same filename as the ‘input file’ but with extension .fvu. Example ‘input file’ name is 27EQGov.txt, the upload file generated will be 27EQGov.fvu.

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  43. Question 28. What Are The Platforms For Execution Of Fvu?

    Answer :

    For Annual Returns, FVU can be executed on any of the Windows platforms mentioned below: Win 95/Win 98/Win 2K Professional/Win 2K Server/Win NT 4.0 Server/Win XP Professional.

    For Quarterly Returns, Java has to be installed to run FVU. Details are given in FVU section of NSDL-TIN website.

  44. Question 29. What Are The Control Totals Appearing In The Error/response File Generated By Validating The Text File Through File Validation Utility (fvu) Of Nsdl?

    Answer :

    The Control Totals in Error/Response File are generated only when a valid file is generated. Otherwise, the Error/Response File shows the nature of error.

    The control totals are as under:

    Number of deductee/party records: In case of Form 24/24Q, it is equal to the number of employees for which TDS return is being prepared. In case of Form 26/27/26Q/27Q, it is equal to the total number of records of tax deduction. 10 payments to 1 party would mean 10 deductee records.

    Amount Paid: This is the Total Amount of all payments made on which tax was deducted. In case of Form 24/24Q, it is equal to the Total Taxable Income of all the employees. In case of Form 26/27/26Q/27Q, this is equal to the total of all the amounts on which tax has been deducted at source.

    Tax Deducted: This is the Total Amount of tax actually deducted at source for all payments.

    Tax Deposited: This is the total of all the deposit challans. This is normally the same as Tax Deducted but at times may be different due to interest or other amount.

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  46. Question 30. Are The Control Totals Appearing In Form 27a Same As That Of Error/ Response File?

    Answer :

    Yes, the control totals in Form 27A and in Error/Response File are same.

  47. Question 31. What Essential Information Should Be Given In The Quarterly Statements To Enable Accurate Generation Of Pan-wise Ledger Account?

    Answer :

    The accuracy of PAN-wise ledger account will depend on:

    1. Correct quoting of TAN by the deductor.
    2. Correct quoting of PAN of deductor.
    3. Correct and complete quoting of PAN of deductee.
    4. Correct quoting of CIN (Challan Identification Number) wherever payment is made by chal lan.
  48. Question 32. How Will The Pan-wise Ledger Account Be Created By Nsdl In Respect Of Payment Of Tds Made By Deductors In Banks?

    Answer :

    The PAN-wise ledger account will be created after matching the information in the TDS/TCS statements filed by the deductor/collector and the details of tax deposited in banks coming through On Line Tax Account System (OLTAS).

  49. Question 33. From Which Financial Year Will The Annual Statement Under Sec. 203aa (form No. 26as) Be Issued?

    Answer :

    The annual statement (Form No. 26AS) will be issued for all tax deducted and tax collected at source from FY 2005-06 onwards after the expiry of the financial year.

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  51. Question 34. Do I Have To Affix A Label On The E-tds/tcs Return Cd/pen Drive? What Do I Mention On The Label Affixed On The E-tds/tcs Return Cd/pen Drive?

    Answer :

    No, there is no need to affix a label on computer media.

  52. Question 35. Can A Single E-tds/tcs Return Be Filed In Two Or More Cd / Pen Drive?

    Answer :

    No, one return cannot be furnished in two computer media.