How To Pay TDS Online: A Step-By-Step Guide

Employees need to pay taxes to the Government each year. To make paying taxes easier for the taxpayers, the Indian Government has introduced TDS (Tax Deducted at Source). TDS is deducted by the employer each month and paid to the Government every year within a specified timeline. If you are an employer and want to pay TDS online, here’s a step-by-step guide to do so easily. Keep reading!

Why TDS was Introduced?

TDS aims to collect tax directly from the source of income. The employer/person who is liable to make payments to another person is responsible for deducting the tax at source and submitting the same to the Government of India. 

As per income tax rules, the deductee is eligible to get credits for the amount deducted through Form 26AS/TDS certificate.  

How to Pay TDS Online?

Benefits of Online TDS Payment

Here are the benefits of online TDS payment:

• Deductors can make TDS payments at their convenience
• Acknowledgement of online payment is received instantly
• One can download and save the TDS payment challan acknowledgement copies for reference
• Decreases the chances of corruption
• Constant availability of TDS payment facilities
• TDS E payment is environment friendly

How to Check TDS Payment Status Online?

To check whether the e-filing of TDS payment by the deductor is successful or not, you can follow these steps:

Step 1: Visit the official TRACES (TDS Reconciliation Analysis and Correction Enabling System) website. 

Step 2: Enter the verification code and click on “Proceed.”

Step 3: Provide the deductee’s PAN details and the deductor’s TAN details. 

Step 4: From the dropdown menu, select financial year, quarter, and type of return. 

Step 5: Finally, click on “Go” to view your TDS status. 

However, there is another procedure that you can follow to view your TDS status without using your PAN card. For that, you have to follow these steps:

Step 1: Visit the Income Tax Department’s official portal.

Step 2: A new member needs to register themselves. Meanwhile, an existing member can log in with his/her User ID and password. 

Step 3: From the “My Accounts” tab, select “View Form 26AS.”

Step 4: Select the relevant “Year” and “PDF Format” to download the file.

Step 5: You can access this file using your date of birth as your password and view your TDS status.

Also Read: A Detailed Guide For Checking TDS Status Using Your PAN Card

Timeline for TDS Payment Online 

The deadline for completing TDS payments varies for government and non-government assessees. 

Due dates for government assessees are as follows:

• For tax payment without challan: The day of deduction
• For tax payment with challan: 7th of next month (for example, the deductor has to pay TDS for the month of February, by  March 7) 

Due dates for non-government assessees are given below:

• Payment of TDS for March: April 30 of that year
• Payment of TDS for every other month: 7th of next month

Quarterly payment 

Only with the permission of the Joint Commissioner, taxpayers can pay TDS every quarter. The deadlines for these payments are as follows:

• Quarter ending on June 30th: July 7
• Quarter ending on September 30th: October 7
• Quarter ending on December 30th: January 7
• Quarter ending on March 30th: April 7

TDS Payment Applicability

Given below are important points related to TDS payment applicability:

• Individuals and HUFs need to deduct TDS if the revenue exceeds Rs. 1 crore for corporations.
• TDS has to be deducted if revenue exceeds Rs. 50 lakh in case of professions. 

Additional Fees Associated In Case of Non-Payment of TDS

Section 234E of ITA states the guidelines in case of delay in TDS payment.

If a taxpayer fails to pay TDS on the stipulated date, then he/she has to pay Rs. 200 as a fine for every day until the amount has been paid. 

How to Pay TDS Outstanding Amount?

Given below are the steps to pay TDS outstanding amount with Challan ITNS 281:

Step 1: Visit the official website of NSDL.

Step 2: Select the Pay Taxes Online option under the ‘Services’ tab on the homepage.

Step 3: Choose Challan ITNS 281 for demand payment.

Step 4: Select major head. Provide the TAN, address, assessment year, minor head/type of payment, nature and mode of payment and bank name. Then click on ‘proceed’.

Step 5: The screen will display the information provided. You need to confirm it and then click on the ‘submit to bank’ button.

Step 6: You will be redirected to the bank’s website where you need to provide your user ID and password.

Step 7: Provide the payment details and make the TDS payment. 

How to File TDS Returns?

Given below are the steps to file TDS returns:

Step 1: Visit the official website of NSDL where the data structure of e-TDS/e-TCS is given.

Step 2: You need to prepare your e-TDS/e-TCS as per the format provided in clean ASCII format with ‘.txt’ as file name extension. Keep in mind that the e-TDS return can be filed using Return Preparation Utility provided by NSDL.

Step 3: You need to verify the file using the File Validation Utility.

Step 4: The FVU will provide the error report if the file has an error.

Step 5: You can submit the .fvu file at TIN-FC or upload it on the official website of NSDL 

Forms Associated with TDS Returns

Given below is the list of the forms associated with TDS returns:

• Form 24Q
  Quarterly statement for TDS deducted from salaries.

• Form 26Q
  Quarterly statement for TDS deducted for payments other than salaries.

• Form 27Q
  Quarterly statement of TDS from interest, dividend or any sum payable to NRIs.

• Form 27EQ
  Quarterly statement of collection of TDS.

Consequences of Missing the Deadline of TDS Payment

• TDS not deducted 
  If you delay in deducting TDS and thus, end up not meeting the TDS payment deadline, the deductor is liable to pay interest. From the due day of deduction to when the deductor actually collects TDS, interest at the rate of 1% is charged per month on the due amount. 

• TDS deducted but payment not made
  Under Section 201A of the Income Tax Act, a non-payment of TDS carries an interest of 1.5% per month on the due amount. This penalty applies from the day of the TDS deduction to the day of successful payment. 

Also Read: All PAN Card Services At NSDL

What is TAN?

Tax Deduction and Collection Account Number is commonly referred to as TAN. It is a 10-digit alphanumeric number issued by the Income Tax department. 

The Government of India has made TAN mandatory for individuals and businesses.

As per Section 203A of the Income Tax Act, one needs to mention the TAN while filing TDS returns. 

How Can You Apply for TAN?

Given below are the steps to apply for TAN online:

Step 1: Visit the official website of NSDL  and choose ‘Online Application for TAN’ (Form 49B).

Step 2: From the drop-down menu, opt for the category of deductors and choose the ‘Select Button’.

Step 3: Fill up the form.

Step 4: If the details submitted do not pass through any format level validation, the screen will display the error.

Step 5: If there is an error, the individual has to rectify it and re-submit it.

Step 6: If the form contains no error, then a confirmation screen will be displayed.

Step 7: Applicant needs to confirm if the information displayed on the screen is correct or not. 

Step 8: After the applicant has paid the requisite fees successfully, an acknowledgement form will be generated.

Step 9: Finally, the applicant needs to submit the hard copy of the acknowledgement form along with all the documents at the following address:

NSDL e-Governance Infrastructure Limited,

5th floor, Mantri Sterling,

Plot No. 341, Survey No. 997/8,

Model Colony,

Near Deep Bungalow Chowk,

Pune – 411016

The applicant needs to write ‘APPLICATION FOR TAN – Acknowledgment Number’ (e.g. ‘APPLICATION TAN – 88301020000244’).​

Final Word

Tax Deducted at Source is crucial as it protects the tax system against individuals who indulge in tax evasion. Fortunately, with digitalisation, you can now pay TDS online from anywhere without submitting a physical challan. 

FAQs on Pay TDS Online

Before you go…

• Looking for instant 🚀 personal loans 24*7 anywhere, anytime? Get personal loans up to ₹20 lakh starting at 9.9% p.a. Install the Navi app now!!
• Or, maybe you’re looking to buy that house you’ve been eyeing 🏠 and you need a loan of up to ₹5 crore. Install the Navi app now and get instant in-principle approval right away! Interest rates starting at 7.89% p.a.
• How about an affordable health insurance policy👨‍⚕️ starting at a monthly premium of just ₹235? Install the Navi app now and get your policy in under 2 minutes.
• Instead, want to put your savings into action and kick-start your investment journey 💸 But don’t have time to do research. Invest now with Navi Nifty 50 Index Fund, sit back, and earn from the top 50 companies.

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.