TDS refers to tax deducted at source. This is the tax that the employer deducts from the salary of an employee before transferring the money. The TDS is then submitted to the government with the Tax Account Number (TAN) of the employer. This TDS reflects against your PAN (Permanent Account Number) and shows up at the time of filing your income tax return (ITR). In case the employer does not submit the TDS to the government, the excess tax can show up when you file your ITR .
How to check if the employer has not deposited your TDS?
The TDS that the employer deducts shows up on your Form 26AS. When the employer deducts tax from your salary, they also issue a TDS certificate or Form 16/ Form 16A. You can compare the information on Form 16 with Form 26AS to check if the amounts match. If there are any discrepancies, they will reflect here.
If your employer does not issue a Form 16, you can check your salary slips.
What are the reasons behind discrepancies in Form 16 and Form 26AS?
There could be discrepancies in Form 16 and Form 26AS for the following reasons:
- The employer may have forgotten to deposit the TDS within the stipulated time.
- The PAN entered could be incorrect.
- The TAN entered could be incorrect.
- There could be a technical error created by the system.
- The assessment year could be entered incorrectly.
What to do if the TDS amount does not match?
If the TDS amount does not match, you can do the following:
- If the discrepancy has been caused due to your employer’s negligence, you must contact the deductor as soon as possible. Once the difference has been corrected, Form 26AS will reflect the new amount automatically. If the employer does not respond to your request, you can directly contact the tax authorities and file a complaint.
- If the details of the PAN or TAN are incorrect, you will again have to contact your employer and ask them to rectify the same. Once the employer has corrected the information, your Form 26AS will be updated with the correct amount.
- In case of small errors, the income tax website will ask you to specify the reason for the tax discrepancies. You can mention the reason and continue with your tax return. If the difference is negligible, the website may accept your submission and initiate your return.
Who pays the tax if TDS is not deposited with the government?
In case of any TDS dues, the liability to pay the tax falls on the employer and not the employee. Since the tax is deducted on the source before the payment reaches the employee, it is the employer’s responsibility to file a TDS return on time.
The Central Board of Direct Taxes (CBDT) can also charge a penalty to the employer for not depositing the government’s tax on time.
What can employees do on their part?
- It helps to check your Form 26AS every quarter to check if the TDS amount is being correctly shown or not. If you find any issues, you should bring it to your employer’s notice at the earliest.
- You can keep a copy of your salary slips, bank account statements, etc. that reflects the TDS amount as proof.
- It also helps to remind your employer to file TDS returns on time to avoid hassles later.
Conclusion
TDS is an important component of your tax returns. Therefore, you must check for irregularities and bring it to the employer’s notice.
