TDS Challan 281 is a challan form used by employers to deposit tax deducted at source (TDS) on salary to the government. It is used for payment of TDS on salary by an employer to the government. This challan form is issued by the Income Tax Department.
In this blog, we decode everything about Challan 281. Read on.
What is Challan 281?
By definition, a challan is an official document that acknowledges a payment. In taxation parlance, challans are documents that are proof of a deposit with the Government, The Income Tax Act 1961 mandates businesses to deduct TDS before an income payment to an individual or entity.
For example, if a company makes a payment of Rs 1 lakh to a contractor, they should deduct Rs. 10,000 (at the rate of 10% TDS) before making the full payment and pay a net amount of Rs. 90,000.
The TDS deducted here should be deposited to the income tax department through Challan 281 on the behalf of the person who earned the income.
Important Points to Consider Before Filing TDS Challan 281
- You will need a TAN number in order to file a TDS Challan 281. In order to get this, You should submit form 49B*
- Verification of TAN is important before depositing the challan. Otherwise, a fine of Rs. 10,000 will be imposed.
- It is important to get a challan certificate with the CIN number while filing TDS challan 281 offline.
- Codes for different TDS challans are usually available at the back of TDS challan 281. It is important to be aware of it while depositing challans under different sections.
- The year which you are filing for( assessment year) is followed by the financial year. It’s important to calculate your income from the previous year.
For example, if a financial year is from 1st April 2020 to 31st 2021 March, then an assessment year is from 1st April 2021 to 31st March 2022. Hence you will be able to file TDS for your assessment year.
- Corporate and non-corporate deductees shouldn’t use similar challans to deposit TDS.
How to deposit Challan 281?
Businesses can deposit TDS payments in 2 modes – online and offline mode.
|1. Visit an authorised bank branch>>get the challan 281 form|
|2. Fill in the required details>>make the payment|
|3. A bank executive will accept the payment>>a receipt of the challan acknowledging the same will be issued|
|4. Once the challan is verified, the tax would be deposited to the Income Tax Department|
|1. Log on to the official TIN-NSDL website|
|2. Home page>>go to the ‘Services’ tab>>click on e-payment>>pay taxes online|
|3. Choose ‘Challan No./ITNS 281’>> click on ‘Proceed’|
|4. Fill up the online form mentioning the following details –
|5. Then enter the captcha code>> click on ‘Proceed’|
|6. Check and confirm the details to proceed|
|7. Complete the online payment through a debit card or net banking account|
|8. Once the transaction is processed>>a digital certificate is issued with the payment details, and CIN (challan identification number)|
How to make TDS payments in 30 seconds?
There’s no denying that the above tedious processes of making TDS payments, both online & offline cost businesses hundreds of hours every year.
Here’s how businesses can pay TDS hassle-free, in just 30 seconds on RazorpayX Online TDS Payment Tool.
- Select your TDS category, tax type, and assessment year
- Next, go ahead and enter your TAN and address
- Enter contact details & amount details: surcharge, penalty
- Click Pay to finish. You’ll receive the challan via the email provided.
So, what are you waiting for?
Make TDS payments online, completely FREE on RazorpayX and avoid late penalties. Pay via multiple payment options including credit card & UPI.
Due dates for depositing Challan 281
The due dates for making TDS payments and filing TDS returns are –
|Month in which income is generated||TDS payment date||Due date of filing TDS return|
|April||7th May||31st July|
|May||7th June||31st July|
|June||7th July||31st July|
|July||7th August||31st October|
|August||7th September||31st October|
|September||7th October||31st October|
|October||7th November||31st January|
|November||7th December||31st January|
|December||7th January||31st January|
|January||7th February||31st May|
|February||7th March||31st May|
|March||30th April||31st May|
Making TDS payments through Challan 281 is part of the legal framework that businesses need to remain compliant. Hence, it’s important to ensure timely TDS payments to avoid hefty penalties.
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Frequently Asked Questions (FAQs)
What are the penalties for late TDS payments?
Delay in TDS payments and filing TDS returns lead to penalties in the form of an additional interest payment.
-Delay in TDS deduction – 1% of the TDS per month or part thereof
-Delay in depositing the deducted TDS – 1.5% of the TDS per month or part thereof
-Delay in TDS return filing – Rs 200/day subject to a maximum of the actual TDS amount. Moreover, if the delay is for a year and above, the penalty might range between Rs. 10,000 to Rs 1 lakh
How does a salaried individual know about their TDS Challan details?
For a salaried individual, you can ask your employer to provide you with TDS Challan certificate. In other scenarios, you can visit website of the Income Tax department. Click on ‘View Your Tax Credit’, check Form 26AS.
If your employer or payer does not pay challan for TDS, how it affects you as an employee?
If your employer does not pay challan for TDS, you will not have to pay any penalties as an employee. It is entirely the responsibility of your employer or payer to pay challan for TDS on time. However, you pay your tax liabilities while filing annual returns. If your employer fails to pay challan for TDS, you will still be eligible for paying taxes.
How to track TDS Challan 281 status using the CIN-based view option?
1.Visit TIN-NSDL website and under the ‘Services’ tab click on ‘OLTAS’
2.Now, click on ‘Challan Status Inquiry’
3.Click on ‘CIN Based View’ under ‘For Taxpayers’ tab
4.Input the BSR code of the collecting bank branch, the challan tender date or date of cash or cheque deposit, the serial number of the challan and the aggregate amount as mentioned in the counterfoil
5.Enter the captcha code and click on ‘View’
6.Check the status displayed
How to Track TDS Challan 281 status using the TAN based view option?
1.Visit TIN-NSDL website, go to ‘Services’ tab and click on ‘OLTAS’
2.Next, click on ‘Challan Status Inquiry’
3.Click on ‘TAN Based View’ under ‘For Taxpayers’ tab
4.Input the TAN number, the challan tender date or the date of deposit
5.Provide the captcha code and click on ‘View challan details’ to check the status
Can I file Challan 281 without a TAN number?
No, as per section 203 of the Income Tax Act, 1961, you would need a TAN number for filing TDS returns using Challan 281.
Can the TDS liability be paid in cash?
Yes, the income tax department allows you to pay off the TDS liability in cash. Other modes of payment accepted by the income tax department include cheques, net banking, and debit card.
You can pay TDS via credit card and UPI only on the RazorpayX TDS Payment tool.
Can I create a nil TDS challan 281?
Yes, you can create a nil TDS challan 281. To do so, enter ‘0’ in the TDS amount column and leave the payment mode field blank.