What is BSR Code – Benefits of Bank BSR Code for Filing TDS and TCS
The Reserve Bank of India (RBI) introduced the Basic Structural Return (BSR) system in December 1972 to help banks keep a record of every digital payment made towards tax filings. Under the system, all registered banks in India are provided with a 7-digit code known as the BSR code. This 7-digit code is segmented into two sets – the first three digits represent the bank, and the next four digits represent the branch of the bank.
The BSR code is unique for each branch of a bank. Banks use this code while filing TDS/TCS returns. This code usually appears in TDS certificates and tax challans.
In this blog, we will mostly cover the basics of the BSR code and its benefits.
What Are BSR Codes Used for?
This coding system is primarily designed to keep track of all online tax payments and to alert the Income Tax Department about the same. Banks primarily find this code useful while filing TCS and TDS returns. Also, pensioners need to mention the BSR code along with their bank account number to receive their pension.
You will find the BSR code to be useful in the following documents:
- OLTAS challan and deduction details
- TDS certificates
- Challan Identification Number (CIN)
What Are the Categories of BSR Codes?
There are seven categories of BSR codes, and each of them has its own application. The categories have been discussed below:
BSR 1:
This code is applicable for half-yearly returns on advances from all bank branches on the last Friday of June and December. This code is further divided into two categories – the first one is for accounts with a limit exceeding Rs. 10,000, and the second one is for accounts with limits below Rs. 10,000.
BSR 2:
This category of code is applicable on half-yearly return deposits made to banks on the last Friday of June and December.
BSR 3:
This code is solely applicable to monthly return advances made by the Head Offices towards the Security of Selected Sensitive Commodities on the last Friday of each month.
BSR 4:
This type of BSR code is applicable once every two months for the Return on Ownership of Bank deposits from all bank branches on the last Friday of March.
BSR 5:
It applies to the yearly bank investment return from the Head Office on the last day of March.
BSR 6:
This code is applicable for the Quinquennial Survey on debits made to deposit accounts from March to April.
BSR 7:
This quarterly code is applicable on the Survey of Aggregate Deposits and Gross Bank Credit by bank Headquarters on last Friday of June, September, December and on March 31.
What Are the Benefits of Using BSR Codes?
Here are the three primary benefits of using BRS codes:
- BSR codes are a great tool for the Income Tax Department to receive and collect information on tax transactions and online uploading of challan details made via banks.
- BSR code is one mandatory requirement if a bank wants to allow a foreign transaction from India. It helps the taxation authority to track the remittances that take place by an individual to a foreign country.
- BSR code is really helpful for retired individuals as it helps them receive their pensions without any disruption or delay.
Difference between IFSC Code and BSR Code
When it comes to the Indian banking system, both IFSC and BSR codes are unique codes that hold immense importance for the banking process. However, there are some remarkable differences between them:
| Basic Structural Return Code (BSR) code | Indian Financial System Code (IFSC) |
| BSR code has seven digits. | IFSC code has a total of eleven characters. |
| RBI assigns this code to banks so that the IT department can track the tax payments easily. | RBI assigns this code for the unique identification purpose of bank branches. |
| The first three digits denote the Bank, and the rest four represent the branch of the bank. | The first four characters denote the bank’s code, the fifth character is a “0”, and the other six define one specific bank branch. |
| RBI provides this code to all the registered banks; it is also used to form the unique challan identification number of a bank. | Every registered bank has to mention this IFSC code in their cheque books, and it is used in multiple payment methods such as RTGS, CFMS and NEFT. |
What is the Connection between BSR Codes and CIN?
Challan Identification Number (CIN) is a unique 20-digit identification ID available on the taxpayer’s part of receipt or challan. BSR is an important segment of CIN. The 20-digit CIN uses a combination of 7-digit BSR code, the date of deposit, which is of eight digits, and the challan number, which is of five digits.
Also Read
Final Word
The BSR code is an important identification number for both banks and taxpayers. Primarily, it aids the Income Tax Department in gathering information about the taxes that are paid through the banks.
FAQs
Ans: To find your challan details, visit the NSDL website and click on the “Services” tab. Select “Challan Status Enquiry” from the available options. Once prompted, provide the BSR or CIN, which is unique for every challan, to get your challan details.
Ans: MICR stands for Magnetic Ink Character Recognition. With the help of this 9-digit numeric code, which is printed with magnetic ink on every cheque book, we can find the Bank and its branch. Apart from your cheque book, you can also find this code on the first page of your bank passbook.
Ans: OLTAS is the abbreviation for Online Tax Accounting System. This system has been launched by the IT department to receive and store information on taxes paid through the online upload of challan details. The collecting bank branch will put a rubber stamp on the challan and its counterfoil mentioning the CIN.
Ans: When you make a tax payment via a specific bank’s branch, the bank will put a rubber stamp on the challan and its counterfoil, which will mention the CIN code. The first seven-digit of the CIN code is your BSR code.
Disclaimer: Mutual Fund investments are subject to market risks, read all scheme-related documents carefully. This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.Before you go…
