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What is Form 26Q?

5paisa Research Team

Last Updated: 17 Oct, 2023 12:02 PM IST

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Many individuals experience anxiety when dealing with matters related to their income tax. A lack of sufficient knowledge is one of the primary obstacles that prevent people from addressing tax-related issues, particularly income tax returns. However, individuals must familiarize themselves with specific rules and terminology to gain the confidence to manage their income tax and related affairs.

In India, the government collects income tax through a mechanism called Tax Deducted at Source (TDS), abbreviated as TDS. This deduction of the TDS amount is carried out in compliance with the Income Tax Act of 1961 provisions. Any payment subject to TDS provisions is disbursed after the required deduction, and the deduction itself adheres to a government-specified percentage.

Form 26Q is the documentation for reporting TDS details pertaining to payments made other than salaries. This form provides information about the total amount paid during a specific quarter and the corresponding TDS amount that has been subtracted. Form 26Q must be submitted quarterly. This article delves into the various aspects of TDS Form 26Q in a comprehensive manner.
 

What is Form 26Q?

So, what is form 26Q? Form 26Q serves as a TDS Return or Statement containing comprehensive information regarding TDS deductions applied to payments apart from salaries. It is mandatory to file this form quarterly, ensuring it reaches the relevant authorities by the stipulated due date. This form encapsulates details concerning payments made and the corresponding TDS deductions executed by the deductor.

Form 26Q finds its applicability in the context of TDS governed by Section 200(3) of the Income Tax Act. It encompasses various sections such as 194, 193, 194A, 194BB, 194B, 194C, 194EE, 194D, 194F, and others. It primarily functions as the declaration for TDS on all payments, excluding those categorised as salary disbursements.
A deductor must furnish their TAN (Tax Deduction and Collection Account Number) to submit this form successfully. Non-government deductors are required to provide their PAN (Permanent Account Number), while government deductors should use "PANNOTREQD" as the specified entry on Form 26Q.
 

What are the Sections Under Form 26Q?

As per the form 26Q meaning, TDS deduction is not mandatory if the payments made and expenses incurred during a fiscal year fall below the threshold limit.

Section  Particulars  Threshold Limit
206A  Submitting quarterly reports for interest payments made to a resident without deducting taxes, excluding interest on securities.

If the amount payable or paid during a fiscal year is less than:

- Rs. 10,000 for deductors that are banking institutions or co-operative societies

- Rs. 5,000 for all other cases
194LA  No Tax Deducted at Source (TDS) is required for compensation payments related to the acquisition of immovable property, with the exception of agricultural land. If the amount payable or paid in a fiscal year (FY) is less than Rs. 2.5 lakh
194J  No Tax Deducted at Source (TDS) is required for remunerating directors, paying royalties, technical fees, or professional fees. If the amount payable or paid in a financial year (FY) is less than Rs. 30,000

 
194-IB  No Tax Deducted at Source (TDS) is applicable to rental payments for any building or land, whether it's made by a Hindu Undivided Family (HUF) or an individual whose accounts do not necessitate auditing as per Section 44AB of the Income Tax Act, to a resident individual. If the rental payment is less than Rs. 50,000 for a portion of a specific month or a complete month.
194-IA  No Tax Deducted at Source (TDS) is required for consideration payments made when purchasing immovable property, with the exception of agricultural land. If the amount payable or paid in a financial year (FY) is less than Rs. 50 lakh.
194-I  No Tax Deducted at Source (TDS) is necessary for rental payments related to plant and machinery, furniture or fittings, land, and buildings. If the amount payable or paid in a financial year (FY) is less than Rs. 1.8 lakh.
194H  No Tax Deducted at Source (TDS) is withheld from brokerage or commission payments. If the amount payable or paid in a financial year (FY) is less than Rs. 15,000, there is no tax deduction for commission payments made by MTNL/BSNL to their PCO (public call office) franchisee.
194G  There is no Tax Deducted at Source (TDS) applied to commission payments related to lottery tickets. If the amount payable or paid in a financial year (FY) is less than Rs. 15,000.
194EE  There is no Tax Deducted at Source (TDS) for payments associated with deposits made under the National Savings Scheme. If the amount payable or paid in a financial year (FY) is less than Rs. 2,500.
194DA  No Tax Deducted at Source (TDS) is applicable to payments made for a life insurance plan (including bonuses) to an Indian resident. If the amount payable or paid in a financial year (FY) is less than Rs. 1,00,000.
194D  No Tax Deducted at Source (TDS) is required for insurance commissions payable or paid in a financial year (FY). If the amount payable or paid in a financial year (FY) is less than Rs. 15,000.
194C  No Tax Deducted at Source (TDS) is deducted from the amount payable or paid to a contractor. If the total amount payable or paid to the contractor is less than Rs. 1 lakh in a financial year or if the amount payable or paid in a single payment to the contractor is less than Rs. 30,000.
194BB  No Tax Deducted at Source (TDS) applies to horse racing winnings. If the amount payable or paid in a financial year (FY) is less than Rs. 10,000.
194B  No Tax Deducted at Source (TDS) is required for crossword puzzles or lottery winnings. If the amount payable or paid in a financial year (FY) is less than Rs. 10,000.
194A  Interest payments, excluding interest on securities, are not subject to Tax Deducted at Source (TDS). If the amount payable or paid in a financial year (FY) is less than Rs. 5,000.
194A  There is no Tax Deducted at Source (TDS) for interest on compensation awarded by the Motor Accident Claims Tribunal. If the amount payable or paid in a financial year (FY) is less than Rs. 50,000.
194A  Interest earned on post office deposits under SCSS, 2004 is exempt from Tax Deducted at Source (TDS). If the amount payable or paid in a financial year (FY) is less than Rs. 10,000.
194A  There is no Tax Deducted at Source (TDS) for interest on time deposits paid by a co-operative bank or a banking institution. If the amount payable or paid in a financial year (FY) is less than Rs. 10,000.
194  No Tax Deducted at Source (TDS) is required for dividends payable to a resident individual via an account payee cheque. If the amount payable or paid in a financial year (FY) is less than Rs. 2,500.
193  Interest payments to a resident on a 7% gold bond of 1980 or a 6.5% gold bond of 1977 do not require Tax Deducted at Source (TDS). If a statement indicates that the nominal value of the bonds did not exceed Rs. 10,000 in the previous year.
193 Interest payments to a resident individual on an 8% savings bond of 2003 are exempt from Tax Deducted at Source (TDS). If the amount payable or paid in a financial year (FY) is less than Rs. 10,000.
193 No Tax Deducted at Source (TDS) is required for interest payments made via an account payee cheque to a Hindu Undivided Family (HUF) or an individual holding company debenture. If the amount due or already paid within a fiscal year is less than Rs. 5,000
192A There is no requirement for Tax Deducted at Source (TDS) when withdrawing from a Provident Fund (PF). If the amount due is less than Rs. 30,000
192 No Tax Deducted at Source (TDS) is deducted from salary payments.

If the income falls below the specified thresholds, there will be no tax implications:

- Rs. 5 lakh for super senior citizens

- Rs. 3 lakh for senior citizens

- Rs. 2.5 lakh for individuals.

 

Who Can File 26Q?

The deductor submits form 26Q, responsible for withholding TDS, to furnish details regarding the TDS deductions carried out on payments issued to residents. The primary objective of Form 26Q is to record TDS withholdings on various payments. It may include rent, professional fees, commission, interest, and other non-salary disbursements made to resident individuals or entities.

The Penalty for Late Filing of the Form 26Q

Late Filing Penalties:

Under section 234E, there is a daily fine of Rs. 200 until the return is filed. This penalty accumulates for each day until it equals the total TDS amount.

Additionally, under section 271H, apart from the penalties outlined in 234E, the Assessing Officer (AO) may impose a penalty ranging from a minimum of Rs. 10,000 to a maximum of Rs. 1,00,000.

However, no penalty under section 271H will be levied if the following conditions are met:

  • The TDS has been deposited to the government.
  • Late filing fees and any interest due have also been paid.
  • The return is filed before the expiration of one year from the due date.
     

Due Date of Filing 26Q

Quarter Due Date
April to June 31st July
July to September 31st Oct
October to December 31st Jan
January to March 31st May

 

How to Download Form 26Q?

The TDS Return Form is divided into four distinct categories. To download Form 26Q, taxpayers can easily follow the steps provided below:

  1. Start by visiting the official NSDL website at https://www.tin-nsdl.com/.
  2. Navigate to the "Downloads" tab and select "E-TDS/E-TCS" from the dropdown menu.
  3. Click "Quarterly Returns," then opt for the "Regular" option.
  4. You will be directed to a new page.
  5. On this new page, locate and choose Form 26Q for download from the " Form " section."
     

Points to Remember About Form 26Q

  • Confirm the validity of all PAN numbers.
  • Validate the challans and attempt to reconcile them using OLTAS or NSDL.
  • File the TDS return along with a duly signed Form-27A.
     

Conclusion

To sum up, comprehending the purpose and importance of Form 26Q is essential for individuals and organizations engaged in financial transactions subject to TDS. By adhering to the instructions, accurately obtaining the form, and submitting it within the stipulated deadlines, you can ensure a seamless and trouble-free process that keeps you in compliance with tax regulations.

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Frequently Asked Questions

Form 16 is specifically for salary income, whereas Form 16A is used for reporting TDS on 'Income Other than Salary.' All the information present in Form 16A can be found in Form 26AS. Once you have successfully filed the TDS return for payments other than salary using Form 26Q, you will need to obtain and download Form 16A.

Form 24Q is to be filed and submitted to report Tax Deducted at Source on salary payments. Conversely, Form 26Q should be filed and provided to report Tax Deducted at Source information on domestic payments other than salary.

Form 24Q is a TDS Return/Statement that includes information about TDS deductions made from employees' salaries by their employers. This form needs to be submitted quarterly within the specified deadline. It contains particulars of the salaries disbursed and the corresponding TDS amounts withheld, which are then remitted to the government.

Form 26Q and the TDS return can be generated and submitted using the NSDL e-Gov eTDS/TCS Return Preparation Utility (RPU). This utility is available for free download from the TIN website. After preparing the return using RPU, it should be submitted to any of the TIN-FCs established by NSDL e-Gov.

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