Tax Deducted at Source (TDS), Tax Collected at Source (TDS) and Business Income Tax Return (B-ITR) are 3 important Prime Direct Tax Compliance which every Firm/LLP/Company doing business in India has to comply and follow the Income Tax Act and Rules and Act regulating Tax Deduction on payment of certain specified expenditures namely Salary, Interest, Rent, Dividend, Commission, Brokerage, Professional Fee, Royalti, Compensation, Advertisement, Contract Works and Payment made to Non Resident/Foreign Companies.
Non-compliance of Tax deduction and/or Deposit shall attract Interest per month and Non Filing of Return attract per day penalty for each return and Prosecution.
Failure to deduct the amount of TDS has to be deducted the TDS but fails to pay the same, the entire amount that was deductible is disallowed u/s 40(a)(ia) for the purpose of computing taxable income from Business. Therefore on such expenditure Income Tax assessing office charges Income Tax with Interest.
