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Tds Payments vs deduction 194C

Eswar Reddy S (CFO- at NHTF) (58270 Points)

03 March 2022

While making the Tds payment u/s 194C , we have only two options

Company Deductees & Non Company deductees

But in practice we pay single tds for 194C.

Do we need to segregate company & non company deductees while making Tds payments ?

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13 Replies

CA Surya Sekar (CFO ) (1347 Points)
Replied 04 March 2022

You have to pay separately..But there won't be any issue from TDS CPC after filing tds returns even if there is no segregation of Tds payments under section 194C

Interchange is accepted within the same section.

In future there will be strict rules

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Eswar Reddy S (CFO- at NHTF) (58270 Points)
Replied 04 March 2022

As of now we are paying single payment .Will try to comply with the bifurcation shortly

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sabyasachi mukherjee (27574 Points)
Replied 04 March 2022

Unless and until you make correct bifurcation individual parties will not get credit of amount deducted . At a later stage no tds certificate will be issued to the assesse to the deductor. The assesse cannot file his return to get credit of the same.

Eswar Reddy S (CFO- at NHTF) (58270 Points)
Replied 04 March 2022

Within the 194C , it is allowed .It asks only while making the payment & not at the time of filing returns.

We have checked it practically , credit is already received by deductees from many quarters.

As long section is same credit will be given .

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JJJ (Need help) (675 Points)
Replied 04 March 2022

Originally posted by : sabyasachi mukherjee
	Unless and until you make correct bifurcation individual parties will not get credit of amount deducted . At a later stage no tds certificate will be issued to the assesse to the deductor. The assesse cannot file his return to get credit of the same.

Not at all.

When making the payment, you can select any section you want, it won't make a difference. The type of deducted also makes no difference. This has been the case for many years now.

We have been doing this in my company for years already. We pay a challan of a round figure and then use that balance across all types of TDS sections, deducted and quarters. When the balance is utilised, we make another random payment of a round figure. And so on.

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CA Puja Sharma (Chartered Accountant) (5010 Points)
Replied 04 March 2022

Yes, while making TDS payments you have to segregate the liability under each section between the company and noncompany deductees.

Eswar Reddy S (CFO- at NHTF) (58270 Points)
Replied 04 March 2022

For 194C adjustment is allowed within the section.Like 194C Non company deductees tax can be used for company deductees vice versa.

But change in section need to check ..

Can we use the 194C Tds for 194J using challan details ?

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JJJ (Need help) (675 Points)
Replied 04 March 2022

Originally posted by : Eswar Reddy S
	For 194C adjustment is allowed within the section.Like 194C Non company deductees tax can be used for company deductees vice versa.But change in section need to check ..Can we use the 194C Tds for 194J using challan details ?

Absolutely you can. Since many years you can simply make the payment under any section and then use the balance for any section in the return. You can also use the same challan for 24Q 26Q 27Q across multiple quarters.

Eswar Reddy S (CFO- at NHTF) (58270 Points)
Replied 04 March 2022

Okay..We are paying section wise .But for 194C single payment, we want to segregate further.

CA Surya Sekar (CFO ) (1347 Points)
Replied 05 March 2022

To avoid qualifications in audit report, you must pay tds under each section..If there is no practical issue then you may bifurcate the tds under 194C also.

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Eswar Reddy S (CFO- at NHTF) (58270 Points)
Replied 05 March 2022

Will try to comply the IT rules

JJJ (Need help) (675 Points)
Replied 05 March 2022

I will repeat again, since 2014 it doesn't matter what section or deductee type your choose. So long the TAN is correct and you can see the amount available in TRACES, you can use it against any TDS deduction in your return.

These were relevant when TDS payments were made manually. But no longer make sense and are no longer relevant.

Your return needs to be correct in terms of the amount deducted depending on the section etc and of course there needs to be money available in the challan. But other than that, just think of it as a bank account and you can use the money as needed (so long as there is money in the account).

Here's one pdf from a third party that quotes the exact circular : https://www.voiceofca.in/siteadmin/document/CBDTCircularonSingleTDSChallan.pdf

Eswar Reddy S (CFO- at NHTF) (58270 Points)
Replied 05 March 2022

Yes.You are right . Practically it may accept it..That may used in the rare events..

Generally we pay section wise payments monthly.

For few big clients we pay party wise payments also .

Few clients don't release the invoice unless we give supporting documents of tax paid under exact Section.Even they want to match the tds amount relating to their earlier invoice