How to File TDS Return: Step-by-Step Process of TDS Filing

TDS payment refers to depositing the tax amount deducted from payments such as salary, rent, or professional fees. This is done using Challan 281. Without making the payment, you cannot proceed correctly with how to file TDS return online, as challan details are mandatory for TDS uploading.

Also Read: TDS in India: Meaning, Rates, Rules and Filing Guide

A TDS return is a quarterly statement submitted by a deductor to the Income Tax Department, reporting the details of tax deducted at source and deposited with the government. It contains information such as the deductor’s TAN, PAN details of deductees, the amount paid, TDS deducted, challan details and the relevant form for TDS return used for reporting.

In simple terms, when you file TDS, you are officially informing the government about how much tax was deducted, from whom, and whether it has been deposited correctly. This is done through the online submission of TDS returns via the income tax portal, making e-filing TDS the standard compliance method today.

Also Read: All About TDS Tax Deducted at Source

Many taxpayers assume that depositing TDS is the same as filing a TDS return. However, these are two separate compliance steps. To fully comply with tax regulations, you must first deposit the tax deducted and then file TDS return reporting those details to the Income Tax Department.

Here is a clear comparison:

TDS returns must be filed by:

• Employers deducting TDS on salary

• Businesses deducting TDS on professional fees, rent, commission, interest, etc.

• Individuals and entities liable for tax audit under Section 44AB

• Companies, LLPs, partnership firms and government offices with a valid TAN

If you are unsure about how I can file TDS returns online, the process involves preparing the return in the prescribed format and completing the TDS uploading on the e-filing portal every quarter.

As per the Income Tax Act, TDS must be deducted on certain specified payments, including:

• Salary

• Rent

• Commission or brokerage

• Professional and technical fees

• Interest (other than interest on securities, where applicable)

• Purchase of immovable property

• Lottery or game show winnings

If you are making any of the above payments and are required to deduct tax, you must ensure timely deduction, deposit, and quarterly TDS return filing through the prescribed form for TDS return.

The government requires deductors to report TDS deductions every quarter to:

• Ensure timely tax collection.

• Maintain transparency in tax credits.

• Enable deductees to claim accurate tax credit and receive refunds within the expected TDS refund time.

• Reduce tax evasion and reporting mismatches.

• Failing to comply with quarterly filing requirements can lead to financial penalties.

Consequences of Late Filing

If a deductor fails to file the TDS return within the due date:

• A late filing fee of ₹200 per day is charged under Section 234E (until the return is filed).

• A penalty ranging from ₹10,000 to ₹1 lakh may be imposed under Section 271H.

Therefore, understanding how to file TDS return correctly and completing the process on time is essential to avoid unnecessary penalties and compliance issues.

Here is a step-by-step guide on how to make a TDS payment online:

Step 1: Visit the Income Tax e-Pay Tax Portal

Go to the official Income Tax e-Filing portal and select the e-Pay Tax option under Quick Links.

Step 2: Enter TAN Details

Choose the option to pay tax using your TAN (Tax Deduction and Collection Account Number). Enter your TAN and mobile number for OTP verification.

Step 3: Select Challan Type (ITNS 281)

Select Challan No./ITNS 281, which is used for TDS/TCS payments.

Choose the correct payment type:

• 200-TDS/TCS payable by the taxpayer

• 400- TDS/TCS regular assessment

Step 4: Select Assessment Year

Select the correct assessment year carefully. Choosing the wrong year may create mismatches during e-filing TDS.

Step 5: Enter Payment Details

Fill in the following details:

• Nature of payment (ex.: salary, non-salary)

• Amount of TDS deducted

• Interest or late fee

Ensure all figures match your records to avoid issues when filing the TDS return online.

Step 6: Make Payment via Net Banking / Debit Card

Choose the preferred payment mode such as net banking, debit card or other available digital methods. Complete the transaction securely.

Step 7: Download Challan Receipt

After successful payment, download and save the challan receipt. It contains important details like:

• BSR code

• Date of deposit

• Challan serial number (CIN)

These details are mandatory when completing the form for TDS return and during TDS uploading.

To file TDS accurately and completely, the online submission of TDS returns without errors, you must keep certain documents and details ready in advance. Having the correct information ensures smooth TDS uploading and avoids rejections or delays.

Here are the key documents and details required:

TAN (Tax Deduction and Collection Account Number)

A valid TAN is mandatory for e-filing TDS. Without a TAN, you cannot proceed with how to file TDS returns online.

PAN of Deductor or Deductees

• PAN of the deductor (employer/business)

• PAN of the deductees from whom the tax has been deducted

Incorrect PAN details can result in mismatches and affect the deductee’s credit and TDS refund time.

TDS Payment Challan Details

You must have accurate challan information, including:

• BSR code

• Challan serial number (CIN)

• Date of payment

• Amount deposited

These details are required while filling out the form for TDS return.

Applicable TDS Return Form

The correct form for TDS return must be selected based on the nature of payment(ex.: salary, non-salary, property, rent, etc.)

Salary for TDS Certificate

For salary payments, details reported should match the information reflected in Form 16 and Form 16A. Many people confuse salary Form 16A, but Form 16 is issued for salary income, while Form 16A is issued for non-salary payments.

Details of Tax Deducted and Paid

• Maintain a clear record of:

• Total amount paid to deductees

• TDS deducted

• Date of deduction

• Date of deposit

Keeping these documents ready makes the process of how to file TDS returns simpler and ensures error-free compliance during TDS uploading on the income tax portal.

Forms Used for TDS Return Filing

Selecting the correct form for TDS return is one of the most important steps when you file TDS. The type of form depends on the nature of the payment and the category of the deductee. Using the wrong form can lead to rejection during TDS uploading or issues in the online submission of the TDS return.

Below is a detailed explanation of the commonly used TDS return forms:

Explanation of Key Forms

Form 24Q

Used when TDS is deducted on salary. The details reported here must match the information reflected in Form 16 and 16A (Form 16 for salary). Employers must file this quarterly as part of e-filing TDS.

Also Read: Form 24Q - TDS Return for Salary Payment

Form 26Q

Applicable for TDS on non-salary payments such as professional fees, commission, rent, and interest paid to residents.

Also Read: Form 26Q - TDS Return Filing for Non-Salary Deductions

Form 27Q

Used when payments are made to non-residents (NRIs or foreign companies), except for salary.

Form 26QB and 26QC

These are challan-cum-statement forms used in specific cases like property purchase and high-value rent payments. They simplify compliance by combining payment and reporting.

Step 1: Download the RPU Utility

You can visit the NDSL portal and download the TDS/TCS Return Preparation Utility (RPU) for online TDS return filings. You must also have a JRE environment downloaded and installed to run this application.

Once downloaded, extract the zip file and open the application. It is the TDS_RPU.bat file that can be found in the extracted zip file.

Step 2: Select the Applicable Form

From the drop-down menu, select the applicable form number and click on the statement type. Regular in this case. Click Continue.

Step 3: Fill in Deductor and Challan Details

Fill out all the details on the form and repeat this process for the next tabs as well. For example, deductee details in the annexure tab, challan details on the challan tab and so on.

Ensure all information matches your payment records and certificates such as Form 16 and 16A, wherever applicable.

Step 4: Download and Add Challan Input File

Next, download the Challan input file by clicking on the TAN based view. Enter your required information and click Download Challan file. It will be a (.csv) file.

Click ‘Create File’, add the .csv file and click ‘Validate’. It will generate and store an ‘FUV File’ in your system.

Step 5: Upload the TDS Return

Next, log in to the E-Filing website using your TAN number.

Under the E-file tab, click Income Tax Forms and then select File Income Tax Forms.

Click ‘Deduction of Tax at source’. You can find it at the bottom of the page.

Select the Form number and other details. Attach the ‘FUV file’ that you previously generated.

Step 6: E-Verify and Submit

Click ‘Proceed to e-verify’ and select a verification option to submit your TDS return.

You will receive an acknowledgement receipt upon successful submission. If it has been rejected, you will get a non-acceptance memo.

Although most deductors prefer e-filing TDS, there is also an offline method available for those who choose to submit returns physically.

Below is the offline process for TDS return filing:

Step 1: Visit the NSDL Portal

Download the relevant form for TDS return and the required utilities from the NSDL website. Prepare the TDS return file using the prescribed format.

Step 2: Fill Form 27A

Form 27A is a control sheet that summarises the quarterly TDS statement. It contains:

• TAN details

• Total amount paid

• Total TDS deducted

• Total TDS deposited

Ensure all details in Form 27A match the data in your TDS return statement. Any mismatch may lead to rejection.

Step 3: Verify Required Details

• Carefully check:

• Correct TAN number

• PAN details for deductees

• Challan details (BSR code, challan serial number, date)

• TDS amount deposited

You must also enter the 7-digit Bank Branch Code (BSR code) correctly for tallying purposes.

Step 4: Submit at NSDL Facilitation Centre

After completing the documentation, submit the TDS return file along with Form 27A at the nearest NSDL TIN Facilitation Centre (TIN-FC). The return will be verified and processed by the authorities.

While the offline method is available, most deductors prefer online submission of TDS returns as it is faster, reduces paperwork, and simplifies the overall TDS uploading process. Understanding how to file a TDS return online is generally more efficient and helps avoid delays or errors in compliance.

Even when you file a TDS return online, small mistakes can lead to rejection, notices or delays in credit to deductees. Whether you are handling e-filing TDS for the first time or regularly managing compliance, avoiding the following common errors is crucial.

Incorrect PAN Details

Entering the wrong PAN of the deductee is one of the most frequent mistakes during TDS uploading. An incorrect PAN can:

• Lead to higher TDS deduction rates

• Prevent proper credit reflection

• Delay the deductee’s TDS refund time

Always verify PAN details before completing the form for TDS return.

Incorrect Challan Details

Mismatch in challan information, such as:

• BSR code

• Challan serial number (CIN)

• Date of deposit

• Amount deposit

This can result in rejection of the return. Ensure that the challan details entered during how to file TDS return online match the actual payment receipt.

Also Read: TDS Challan Correction

Selecting the Wrong TDS Return Form

Using the wrong form for TDS return (for example, filing 26Q instead of 24Q) can cause processing errors. Before you file TDS, confirm the nature of the payment and choose the correct form.

Mismatch Between TDS Paid and TDS Reported

The TDS amount deposited must match the amount reported in the quarterly return. Any discrepancy can trigger notices from the department.

Late Filing of TDS Return

Delaying the online submission of TDS return beyond the due date attracts:

• ₹200 per day late fee under Section 234E

• Additional penalties under Section 271H

Timely compliance ensures smooth credit to deductees and avoids unnecessary financial burden.

Errors in Deduction or Reporting Period

Reporting transactions in the wrong quarter or incorrect assessment year is another common issue during e filing TDS. Always double-check the filing period before submission.

Filing TDS correctly follows a simple sequence: Deduct, deposit and file return. First, deduct the applicable tax at source. Next, deposit it using the prescribed challan within the due date. Finally, complete the quarterly compliance through the online submission of TDS return. Timely and accurate filing helps avoid penalties, ensures smooth credit reflection for deductees and prevents delays in refund processing. Since the entire process is digitised, e-filing makes compliance faster, simpler, and more efficient.

While TDS compliance helps you meet statutory obligations, smart tax planning can further reduce your taxable income. One effective way to optimise tax savings is by investing in medical insurance under Section 80D of the Income Tax Act. Premiums paid towards health coverage qualify for deductions, helping you lower your tax liability while securing financial protection against medical emergencies.

If you are looking to buy medical insurance that offers comprehensive coverage and seamless digital services, consider TATA AIG. From easy policy purchase to smooth renewals and quick claim assistance, TATA AIG simplifies the process end-to-end.

For broader protection, opting for family health insurance is a practical step. A well-structured best health plan can cover your spouse, children and even dependent parents under a single policy, while also helping you maximise tax benefits. Explore TATA AIG’s family health insurance solutions today and choose a plan that safeguards both your family’s health and your financial well-being.