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Form 26Q: TDS Return Filing for Non Salary Deductions

By Mohammed S Chokhawala

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Updated on: Feb 21st, 2025

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3 min read

Filing Form 26Q is a crucial obligation for any payer who deducts Tax Deducted at Source (TDS) on payments other than salary. This quarterly return provides the Income Tax Department with essential information about various payments, ensuring transparency and compliance with tax regulations. Understanding how to accurately file Form 26Q is vital to avoid penalties and interest for late filing.

Budget 2025 Update

The Union Budget 2025 proposed the rationalisation of Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) to ease compliance challenges for taxpayers especially for middle-income earners. The government has raised the threshold limits across various TDS sections, aiming to simplify the tax process. The proposed changes are as follows

Section

Present

Proposed 

193 - Interest on securities

NIL

10,000

194A - Interest other than Interest on securities

(i) 50,000/- for senior citizen;

(ii) 40,000/- in case of when payer is bank, cooperative society and post office

(iii) 5,000/- in other cases

(i) 1,00,000/- for senior citizen

(ii) 50,000/- in case of when payer is bank, cooperative society and post office

(iii) 10,000/- in other cases

194 – Dividend, for an individual shareholder

5,000

10,000

194K - Income in respect of units of a mutual fund

5,000

10,000

194B - Winnings from lottery, crossword puzzle Etc. &

194BB - Winnings from horse race

Aggregate of amounts exceeding 10,000/- during the financial year

10,000/- in respect of a single transaction

 

194D - Insurance commission

15,000

20,000

194G - Income by way of commission, prize etc. on lottery tickets

15,000

20,000

194H - Commission or brokerage

15,000

20,000

194-I - Rent

2,40,000 (in a financial year)

6,00,000 (in a financial year)

194J - Fee for professional or technical services

30,000

50,000

194LA - Income by way of enhanced compensation

2,50,000

5,00,000

206C(1G) – Remittance under LRS and overseas tour program package

7,00,000

10,00,000

Note: 

  • The Tax Collected at Source (TCS) will be removed on remittances made for educational purposes when these remittances are financed through loans from specified financial institutions (Section 80E).
  • The Tax Collected at Source (TCS) on the purchase of goods will be removed, effective from April 1, 2025.
  • The higher TDS rate will only apply in cases where taxpayers do not provide PAN. 

Total amount paid during the quarter and TDS amount deducted on such payments have to be reported in 26Q.In this article, we will discuss about the following:

  • Overview of Sections in Form 26Q
  • Mandatory Fields in Form 26Q
  • Interest for Delayed TDS Deduction or Deposit
  • Penalties for late filing
  • Important points
  • FAQs

Sections Covered in 26Q

  • 193 – Interest on securities
  • 194 – Dividend
  • 194A – Interest other than Interest on Securities
  • 194B – Winnings from lotteries and crossword puzzles
  • 194BB – Winnings from horse race
  • 194C – Payment of contractor and subcontractor
  • 194D – Insurance commission
  • 194DA – Maturity of life insurance policy
  • 194EE – Payment in respect of deposit under national savings scheme
  • 194F – Payments on account of repurchase of Units by Mutual Funds or UTI 94F
  • 194G – Commission, prize etc., on sale of lottery tickets
  • 194H – Commission or Brokerage
  • 194I(a) – Rent
  • 194I(b) – Rent
  • 194J – Fees for Professional or Technical Services
  • 194K – Income in respect of units
  • 194LA – Payment of Compensation on acquisition of certain immovable property
  • 194LBA – Certain income from units of a business trust
  • 194LBB – Income in respect of units of investment fund
  • 194LBC – Income in respect of investment in securitization trust
  • 194N – Payment of certain amounts in cash
  • 194O – Payment of certain sums by e-commerce operator to e-commerce participant
  • 194Q – TDS on purchase of goods
  • 194R – TDS on benefit or perquisite in respect of business or profession
  • 194S – TDS on transfer of Virtual Digital Assets 
  • 197A – Details of payment where there is no deduction of tax in certain cases

Details to be Filled in 26Q

As against 24Q which contains 2 annexures, Form 26Q contains only one annexure. Challan details (BSR code, date of payment, total amount etc.), details of deductor and deductees are to be mentioned. Along with this, if the deductor hasn’t either deducted TDS or deducted it at a lower rate, reasons are also to be mentioned in the form.

Due Date of Filing 26Q

The due date of filing form 26Q is as follows:

QuarterDue Date
April to June31st July
July to September31st Oct
October to December31st Jan
January to March31st May

Interest for Late Deduction or Late Deposit

If TDS is not deducted – 1% per month, from due date of deduction to actual date of deduction

If TDS is deducted but not deposited – 1.5% per month, from actual date of deduction to actual date of payment

Penalties for Late Filing of 26Q

Late Filing Fees – under section 234E, a fine of Rs. 200 per day is to be paid until the return is filed. This amount has to be paid for each day until total fine becomes equal to the TDS amount.

The penalty under 271H – In addition to fees to be paid under 234E, AO may charge the penalty of minimum Rs. 10,000 and maximum Rs. 1,00,000.

No penalty will be charged under 271H if –

  • TDS is deposited to the government
  • Late filing fees and interest (if any) is also deposited,
  • Return is filed before expiry of 1 year from due date

Points to Remember

  • Verify all the PAN numbers,
  • Verify the challans, and try to match them through OLTAS or NSDL
  • Signed Form-27A is to be filed with the TDS return
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Frequently Asked Questions

Can I file Form 26Q seperatley for contractors, professionals, interest, etc.?

No. A single Form No. 26Q with separate annexures corresponding to each challan payment for each type of payment has to be filed for all payments made to residents.

By whom should the control chart Form 27A be signed?

Form 27A is the summary of the TDS/TCS statement. It has to be signed by the respective authorized person who is designated to sign the same.

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About the Author

I'm a chartered accountant, well-versed in the ins and outs of income tax, GST, and keeping the books balanced. Numbers are my thing, I can sift through financial statements and tax codes with the best of them. But there's another side to me – a side that thrives on words, not figures. Read more

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