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RazorpayX - Automatic Tax Payments

TDS deduction is mandated by the government. When you upload an invoice to the RazorpayX Vendor Payment app, you have the option to calculate and deduct tax at source. This tax deducted at source (TDS) can be automatically paid using the RazorpayX Tax Payment app.

Note:
TDS is calculated for all invoices uploaded to the RazorpayX Vendor app, irrespective of how you paid the invoice.

Advantages🔗

  • TDS is automatically calculated for you when you upload an invoice on the RazorpayX Vendor Payment app.
  • TDS data is automatically entered on the Tax Payment app.
  • TDS payments are automatically made for you before the due date. No need to worry about late fees and penalties.
  • Data entry errors are avoided.
  • TDS challans are saved and can be accessed by you at any time.
  • Saves you time and effort.

Set up Automatic Tax Payments🔗

To set up the tax payments, we will need a few details, such as your TAN number and business address. To set up tax payments:

  1. Log into your Dashboard.
  2. Navigate to Menu → Tax Payments.
  3. Click Setup Tax Payments and enter the required details such as TAN number and business address and click Continue.
  4. Click Enable Auto-Pay, select the auto-debit account (virtual or current account) and click Enable Auto-Pay.
  5. Enter the OTP you receive on your registered mobile number and click Confirm.

Watch the below video to learn how to automate tax payments.

Change Details🔗

You can change your TAN and business address details from the RazorpayX Dashboard. To do this:

  1. Log into your Dashboard.
  2. Navigate to Menu → My Account & Settings → Business Profile.
  3. Click EDIT DETAILS in the TAX DETAILS section to edit your TAN and business address details.

Disable Automatic Tax Payments🔗

You can disable tax payments at any times, if you choose. To do this:

  1. Log into your Dashboard.
  2. Navigate to Menu → My Account & Settings → Business Profile.
  3. Use the Auto-Debit for TDS on Vendor Payment toggle in the TAX DETAILS section to disable tax payments.

How it works🔗

  1. When you create a vendor on the RazorpayX Dashboard, you set a TDS category for the vendor.
  2. When you upload an invoice and select the vendor, the TDS component is auto-calculated according to the TDS rate selected for the vendor.
  3. When you make a vendor payment, the TDS amount is recorded against the relevant category. The TDS amount is NOT deducted from your account balance at this stage.
  4. TDS payment for the previous month will be paid automatically on the 4th of every month. The TDS amount is deducted from your account balance at this stage.
  5. Once the TDS is successfully paid, the challan is available for download on the Dashboard.
  6. You can download the challan and file the TDS as per your convenience.

Mark As Paid🔗

There is a possibility that you paid TDS using some other method. In such cases, you can mark a TDS payment as paid from the RazorpayX Dashboard.

Note:

  • You can only mark a TDS payment as paid after the 1st of the following month.
  • Late fees, if any, will have to be paid by you.

TDS Categories🔗

Listed below are the various TDS categories and rates available to you.

Lowered TDS Rate:
As per government norms, TDS rates have been reduced by 25% till the end of FY21. This is the lowered rate in below table.

Category

Original Rate

Lowered Rate

194A Interest

10%

7.5%

194C Contractor - HUF/Individuals

1%

0.75%

194C Contractor - Others

2%

1.5%

194H Commission or brokerage

5%

3.75%

194I Rent on Plant and Machinery

2%

1.5%

194I Rent on Land or building or furniture or fitting

10%

7.5%

194J Fee for professional services

10%

7.5%

No TDS

0%

0%

Note:
The TDS rates are subject to change as per government guidelines. Refer to the income tax website for the latest TDS updates.

Calculating TDS🔗

TDS is calculated on the invoice subtotal, that is, the invoice amount without GST, Cess and other taxes.

Note:
As per government norms, TDS rates have been reduced by 25% till the end of FY21.

Let us say TDS for a vendor is set to 7.5%.

CopySubtotal (Amount without GST, Cess and other taxes.) = ₹5,000
TDS = ₹5,000 x 7.5%
TDS = ₹375
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