How to Make TDS Payment

  • Author :
  • TATA AIG Team
  • Published on :
  • 21/11/2023

The mandate rule within the country today is to keep a check on the tax payments from citizens as this money goes to the betterment of society. However, there are many tax exemptions and scope of relief available for the citizens.

TDS, or Tax Deducted at Source, is a big part of the taxation system in our country. It applies to individuals and companies wherein they must deduct and pay a sum of the amount as part of income at source to the government.

In this blog, we will discuss the process of online TDS payment, why TDS payment is essential, and its eligibility.

All About TDS

If you need clarification about the exact TDS process meaning, it is a tax payment made to the government as part of income tax.

It is a system that allows the government to receive taxes before any income is generated within a specific time frame to avoid interest payments. All the TDS payments go directly to the Central Government via the tax department.

The TDS payments are required to be completed by the 7th of each month for the previous month. However, TDS deducted on purchases of property or rental payments can be paid within 30 days from the end of the previous month.

Step By Step Guide For Successful TDS Deposit Online

To know how to pay TDS online, you need to understand the process of e-TDS payment, which includes a list of steps and information inputs. Before knowing the process to complete the TDS challan payment online, it is necessary to collect the following information.

TAN- An alphanumeric number of 10 digits, available with the deductor or payer as an identity proof. If you do not have one, you can easily apply for one online at the official website of NSDL.

PAN- PAN is necessary for identification.

Details like name, address, PAN, etc. of the deductee.

Payment details to ensure you have deducted under the right category between salary, rent, interest, insurance, etc.

Year of Assessment

Now, to make a TDS e-payment, follow all the steps mentioned below.

Go to the official website of the income tax department.

Select the “e-pay tax” option from the left side of the main page.

Now, enter all the relevant details collected before starting this process into the new page you are redirected to. The information blanks consist of PAN or TAN details and a mobile number for OTP.

Once done, select “Continue” from the bottom of the page.

To proceed, enter the OTP received on the mobile number entered on the previous page and then select “continue” again.

Once the OTP is verified, your details will be flashed on the screen.

Next, choose the “assessment year” and select “proceed.”

Now, you will be asked to enter details related to the TDS payment, like mode of payment, tax break up, payment category, etc.

After completing all these details, double-check to ensure no error before adding the “captcha code.”

Once done, click on “Proceed.”

Now, choose the mode of payment or bank for payment completion.

You will not be redirected to the payment gateway of the chosen bank.

Log in using your net banking credentials.

Make the payment for TDS.

Once completed and upon receiving payment confirmation, wait for the automated challan.

When done, check for the CIN and payment details against your TDS payment and download it for bookkeeping.

Offline TDS Payment Process

You can also make TDS payments offline by following the steps below:

Go to the official website of the Income Tax Department.

Download the Challan 281 or Challan 282.

Print the form to enter all the necessary details physically.

Details include TAN, PAN, personal details like name, address, etc., and other relevant requirements.

Once completed, visit your nearest bank.

Pay the TDS amount along with the challan document to the bank.

Upon successful payment, you will receive a stamped payment receipt from the bank confirming the payment.

Top Reasons to Complete Timely TDS Payments Online

It is advised to always comply with the payment deadlines for TDS to avoid legal concerns or monetary expenses. The top reasons to do so include:

Reduces the scope of fines and penalties significantly, which can otherwise be financially exhausting.

Timely payments assist in developing good relations between payees and businesses.

With regular payments, the government can monitor and maintain a tax revenue cycle.

Helps speed up the process of TDS returns.

Online TDS payments are secure, ensuring no fraud.

You can easily track the payment status and proof of payment when you complete TDS payment online.

TDS on Health Insurance

Regarding a health insurance policy, most plans under this category are eligible for tax deductions on premium amounts. Whether individual health or critical illness insurance, all premiums are tax exempted. TDS, however, is a tax payable by citizens to the government.

The benefits of health insurance policies are plenty, making it a great investment for yourself and your loved ones. The premium amount paid against your health insurance policies is eligible for tax exemption under Section 8D of the Income Tax Act 1961.

There might be some cases wherein the payouts for health insurance plans are eligible for TDS deductions. However, it is mostly in cases where the claim or maturity amount value exceeds a set limit. Based on the amount, an insurance provider can deduct TDS.

Conclusion

Making TDS payments accurately and on time is mandatory for all individuals and organisations to comply with the government's laws.

By following this step-by-step process, as mentioned above, tax payments and returns will follow a proper cycle, ensuring you deduct and deposit as required.

TDS payments are a big part of our taxation system, so making timely payments and filing TDS returns within the specified time frame is necessary.

FAQS

What is the eligibility to file TDS returns?

All incomes generated via salaries, commissions, interest payments, rental income, etc., are all eligible for tax deductions and returns. The TDS rates differ based on earnings and source, between 1% to 30%.

Is there a different process to follow if I file and complete the TDS payment for the first time?

No, the process of filing TDS is the same for everyone, regardless of whether it is the first time or a regular practice. You need to do it either online or offline. For online, visit the official Income Tax Department website.

Do we have to prepare TDS in advance before making payments?

Yes, TDS is tax deducted at source, which means it is necessary to deduct it and make the required payments after to credit the deductible value to the Central Government.

Disclaimer / TnC

Your policy is subjected to terms and conditions & inclusions and exclusions mentioned in your policy wording. Please go through the documents carefully.

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