CBDT - Standard Operating Procedures (SOP) for Administering TDS
THE introduction to the SOP says,
TDS is a non-obtrusive but powerful instrument to prevent tax evasion as well as to expand the tax net. TDS also minimizes tax avoidance by the taxpayer (income earners), as the payee's transaction(s) are reported to the Department by the third person. The contribution of TDS to the overall gross direct taxes collections during F.Y.2013-14 was Rs.2,71,069crore. This is a 17.88% growth over the collections shown under this minor head from Rs.2,29,943crore during F.Y.2012-13. Thus, TDS now contributes more than 37% to the gross direct taxes collections, emphasizing its ever-growing importance.
With the Centralized Processing Cell for TDS at Vaishali, Ghaziabad, the TDS administration is now driven through technology support. The CPC-TDS provides comprehensive MIS on compliance behaviour of the deductors, defaults details, PAN errors besides helping the deductor or the Department to identify & rectify mistakes. The strategy to augment revenue through TDS ought to be, therefore, a mix of enforcement, capacity building (external and internal) and leveraging of information that is now available with the Department through the CPC-TDS.
With the enablement of all functionalities, available to the TDS Assessing Officer through AO Portal, the Standard Operating Procedure (SOP) specifying the role of Officers, who are associated with TDS administration, becomes necessary. The SOPs have been framed to address the various features in the re-engineered processes in TDS administration. The SOPs have been made on following issues: -
i. Matching the unconsumed challan. A challan may remain unconsumed on the computer system under following circumstances:
ii. Top deductors paying less/no tax with respect to previous financial years: In past few years it has been observed that the list of top deductors is fluctuating very frequently in each CsIT (TDS) charge. This is mainly due to sudden break in depositing TDS or by paying very less TDS by many top deductors in relevant financial years. The downfall in TDS deduction of top deductors of the region needs to be monitored. The analysis of the downfall in TDS deduction should consider quantum of deduction, nature of the payment and reason for downfall.
iii. Resolvable/Collectible TDS Demand. The outstanding TDS demand can be classified under various categories on the basis of immediate liquidation and prioritization. The outstanding TDS demand which are recoverable immediately and free from any dispute or litigation or corrections can be clubbed the category "resolvable demand".
iv. G-OLTAS reconciliation. Reconciliation of TDS reported by AINs with payments through OLTAS by State AGs is an important task for the field formation.
v. Corporate connect for TDS compliance. CPC(TDS) has taken steps like "Corporate connect for TDS Compliance" for providing non- adversarial tax administration at the corporate level. The attempt is to make the "Principal Officer" of the corporate entity aware about the TDS defaults being committed by underlying branches. The purpose of the exercise is to impress upon the Head office that any default on part of branches and consequential interest, penalty is ultimately the liability of the corporate.
As on date, a comprehensive view is available to the corporate entity (at PAN level) that displays TAN-wise defaults/compliance patterns for different years. This view is available to the corporates online under the heading ‘Aggregated TAN compliance' on the portal of the CPC-TDS TRACES.