Reply To TDS Notice
Reply to TDS Demand Notice
Many persons receive a TDS demand notice from the Income Tax Department. A TDS demand notice could be sent for any one of the following defaults:
- Short payment
- Short deduction
- Interest on payments default under section 201(1A)
- Interest on short payment
- Interest on late payment
- Additional late payment interest
- Interest on deduction default under section 201(1A)
- Interest on short deduction
- Interest on late deduction
- Additional late deduction interest
- Short payment on account of late filing fee
- Additional late filing levy
- Interest under section 220(2)
The TDS demand notice does not inform the deductor about the reason behind the notice. To find out the reason for default, the deductor has to download a justification report from the TRACES website. The justification report contains all details about the TDS demand notice.
TDS Return is required to be filed by any person who is liable to deduct tax at source. A TDS Return is a quarterly statement which has to be submitted to the Income Tax Department of India. Submitting TDS Return is mandatory if you are a deductor. It should contain all details of TDS deducted and deposited by you for a particular quarter.
You may need to file TDS correction or TDS revision if you have wrongly shown any details in original TDS Returns. Such mistakes can be wrong PAN, wrong date, or short or no tax deduction. In all such cases, in order to ensure seamless credit to the person whose TDS is deducted, you should revise your TDS Return.
You may also need to revise your TDS return if you have short paid any TDS and received any notice from income tax department. It should be noted that only by paying short deducted TDS, your work is not over. This has to be given effect through a correctly filed TDS statement.
TDS return may be corrected as many times as needed. There is no due date by which a TDS return has to be revised. Hence, as soon as an error is discovered, you should file a correction return.
Even a minor error in tax return can invite a notice from the tax department. We provides TDS expert assistance to help you understand and respond to income tax notices.