Higher TDS for Income Tax Return Defaulters w.e.f. 1st July 2021 - Decoding section 206AB

Manish Gupta | Last updated: 21 July 2021

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From 1st July 2021, a new section 206AB in the Income Tax Act mandates higher TDS deductions for individuals who haven't filed their income tax returns for the two preceding years, provided their total TDS in those years was ₹50,000 or more. This measure aims to encourage timely ITR filing. The section applies to various payments, with specific exceptions like salary and certain cash withdrawals. The CBDT has introduced a compliance check facility to help deductors identify 'specified persons' and avoid penalties.

Have you filed ITR for the previous two years? If not, then this article can disappoint you. This is the hard truth that the Income Tax Department has introduced a new section 206AB effective from 01.07.2021 that ensures a higher deduction of TDS for the payees who havedefaulted in filing their retu

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About the Author

Manish Gupta

Practicing Chartered Accountant

Manish Gupta is the Founder of Manish Anil Gupta Co. He is a qualified Chartered Accountant and Fellow member of Institute of Chartered Accountants of India with more than 11 years of experience in the industry. During his professional journey, he has gained in-depth experience in the areas of International Taxation, ... Read more

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