Income Tax - Salaries - CBDT Issues TDS Circular
IT is customary for the CBDT to issue a circular on deductions, computation, TDS etc. on salaries, every year.
The present Circular contains the rates of deduction of income-tax from the payment of income chargeable under the head "Salaries" during the financial year 2015-16 and explains certain related provisions of the Income-tax Act.
Jail if TDS is not credited to Government: The Circular warns that Section 276B lays down that if a person fails to pay to the credit of the Central Government within the prescribed time, the tax deducted at source by him or tax payable by him under the second proviso to Section 194B, he shall be punishable with rigorous imprisonment for a term which shall be between 3 months and 7 years, along with fine.
It may be noted that under the new TDS procedure, TAN of deductee/ PAN of the deductee and receipt number of TDS statement filed by the deductor act as unique identifier for granting online credit of TDS to the deductee. Hence due care should be taken in filling these particulars. Due care should also be taken in indicating correct CIN/ BIN in TDS statement.
Compulsory Requirement to furnish PAN by employee (Section 206AA):Section206AA makes furnishing of PAN by the employee compulsory in case of receipt of any sum or income or amount, on which tax is deductible. If employee (deductee) fails to furnish his/her PAN to the deductor, the deductor has been made responsible to make TDS at a higher rate.
CBDT CIRCULAR NO. 20/2015 [F.No. 275/192/2015-IT(B)], Dated: December 02, 2015