CLASSIFICATION OF SELLER AND BUYER UNDER TAX COLLECTED AT SOURCE

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CLASSIFICATION OF SELLER AND BUYER UNDER TAX COLLECTED AT SOURCE

There are some specific people or organizations who have been classified as SELLERS for tax collected at source. No other seller of goods can collect tax at source from the buyers apart from the following list :

  1. Central Government
  2. State Government
  3. Local Authority
  4. Statutory Corporation or Authority
  5. Company registered under Companies Act
  6. Partnership firms
  7. Co-operative Society
  8. Any person or HUF who is subjected to an audit of accounts under Income tax act for a particular financial yea

 BUYERS liable to pay the tax at source to the sellers

  1. Public sector companies
  2. Central Government
  3. State Government
  4. Embassy of High commission
  5. Consulate and other Trade Representation of a Foreign Nation
  6. Clubs such as sports clubs and social clubs

TCS Payments & Returns

 The dates for paying TCS to the government are :

Collection Month Quarter Ending Due date of Payment Due Date of filing return
April 30th June 7th May 15th July
May 7th June
June 7th July
July 30th September 7th August 15th October
August 7th September
September 7th October
October 31st December 7th November 15th January
November 7th December
December 7th January
January 31st March 7th February 15th March
February 7th March
March 7th April

 

All sums collected by an office of the Government should be deposited on the same day of collection.

                  The seller deposits the TCS amount in Challan 281  within 7 days from the last day of the month in which the tax was collected.

 Penalty for late Payment

             If the tax collector responsible for collecting the tax and depositing the same to the government does not collect the tax or after collecting doesn’t pay it to the government as per above due dates, then he will be liable to pay interest of 1% per month or a part of the month.

            Every tax collector has to submit quarterly TCS return i.e. in Form 27EQ in respect of the tax collected by him in a particular quarter. The interest on delay in payment of TCS to the government should be paid before filing of the return.

Certificate of TCS

               When a tax collector files his quarterly TCS return i.e.  Form 27EQ, he has to provide a TCS certificate to the purchaser of the goods.

 Form 27D is the certificate issued for TCS returns filed. This certificate contains the following details:

  1. Name of the Seller and Buyer
  2. TAN of the seller i.e. who is filing the TCS return quarterly
  3. PAN of both seller and buyer
  4. Total tax collected by the seller
  5. Date of collection
  6. The rate of Tax applied

 

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