11 July 2024
Certainly! Here are the differences between Challan 281, Penalty, and Penalty under Section 234E of the Income Tax Act:
### Challan 281: Challan 281 is used for the payment of TDS (Tax Deducted at Source) and TCS (Tax Collected at Source). It is primarily used by deductors and collectors to deposit the tax deducted or collected from various payments made. Here are some key points about Challan 281:
- **Usage**: It is used for depositing TDS/TCS with the government. - **Details Required**: You need to fill in details such as the type of payment (TDS or TCS), PAN of the deductor/collector, assessment year, etc. - **Sections Covered**: Payments made under sections like 192, 194, 194A, 194C, etc., for TDS, and sections like 206C, 206CC for TCS can be made using Challan 281. - **Purpose**: It ensures that taxes deducted at source or collected are deposited with the government on time.
### Penalty: A penalty in the context of income tax refers to a monetary punishment imposed by the tax authorities for various non-compliance issues. Penalties are levied for different violations of tax laws, such as:
- **Late Filing**: For not filing income tax returns within the due date. - **Under-reporting of Income**: If there is a discrepancy found between the reported income and actual income. - **Non-disclosure**: For not disclosing certain incomes or assets as required. - **Other Violations**: Failure to comply with provisions like maintaining books of accounts, providing documents as requested by authorities, etc.
The amount of penalty can vary depending on the nature and severity of the violation.
### Penalty under Section 234E: Section 234E of the Income Tax Act specifically deals with the levy of a penalty for late filing of TDS returns. Here are the key points about Section 234E:
- **Late Filing**: It applies when a deductor fails to file TDS returns within the due dates prescribed under the Income Tax Act. - **Penalty Amount**: The penalty under Section 234E is ₹200 per day for each day of delay until the return is filed. However, the penalty cannot exceed the total amount of TDS deducted or ₹1,00,000, whichever is lesser. - **Purpose**: It encourages timely filing of TDS returns to ensure accurate reporting and compliance with tax laws.
### Summary: - **Challan 281** is used for depositing TDS/TCS payments with the government. - **Penalty** in income tax refers to fines imposed for various non-compliance issues. - **Penalty under Section 234E** specifically applies to late filing of TDS returns and has a prescribed penalty amount for each day of delay.
Understanding these distinctions helps in complying with income tax regulations and avoiding penalties by ensuring timely payments and filings.
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