Form 26AS showing wrong picture - TDS Treament

Asha Kanta Sharmapro badge (Manager - Finance & Accounts)   (36365 Points)

23 January 2021  

We have one problem in Form 26AS for FY 2019-20 of one of our team members shows his client deducted and paid against his PAN but the problem is that subsequently these Invoices were revered/Credit Notes were issued by him to this client and so his client did not make any payment to him as all invoices where credit noted in client’s books of accounts. But the problem here is that the client had already deposited the TDS amount against his PAN which is being reflected in his Form 26AS Which shows wrong overall picture that these are the incomes for him from that particular client. So, do we need to show this income in his Income Tax Filling for 2019-20. Logically it should not be but if he does not show this then Income Tax Dept may find the differences between Form 26AS reported Income Vs Income Tax Fillings Declared Income and may issue a demand/show cause notice to him. There should be a logical and clear TDS Treatment/reversal process for the cases where TDS was deducted against Original Invoice. In practice is not possible to reverse the TDS once it is paid.

 

Need advice/views from the respected community members on the above topic.

 

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