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TDS — Deductor Compliance

TDS Compliance for Deductors: TAN, 24Q/26Q/27Q, 234E, 197 Certificate

Get TAN via 49B (~a week) · deposit by the 7th monthly · file 24Q/26Q/27Q quarterly · late return = ₹200/day (234E) · no PAN = 20% · vendors with 197 certificates get lower/nil TDS. Plus new 194T firm→partner rule.

Deductor calendar + penalties

ObligationRule
TAN (49B online)Mandatory for all deductors — except 194-IA/194-IB/194M (26QB/QC/QD route)
Deposit TDSBy the 7th of next month (March: 30 April)
Returns: 24Q salary / 26Q domestic / 27Q NRI / 27EQ TCS31 Jul / 31 Oct / 31 Jan / 31 May
Late return — 234E₹200/day, capped at the TDS amount
Late deduction/deposit — 201(1A)1% / 1.5% per month interest
No PAN — 206AA20% (or higher applicable rate)
197 certificate (vendor applies via Form 13)Deduct at the lower/nil rate printed on it
New: firms/LLPs must deduct 10% TDS (194T) on partner salary/interest/bonus above ₹20k aggregate/partner/year (from 1-Apr-2025) — profit share stays exempt. Full TDS chart (Sec 393) → · All due dates →
⚠️ Mistake we see: depositing TDS but skipping the statement
New deductors think paying TDS challan = done. It's half-done: the quarterly statement (24Q/26Q) is what moves credit to the payee's 26AS. No statement → payee can't claim credit → their refund stuck → they chase YOU. Plus ₹200/day late fee (234E). Our rule: deposit by the 7th, file the statement the same week. And apply TAN before the first payment — deducting without TAN is its own penalty.
🧮 Quick maths: TAN in a week, rhythm for life
No TAN yet? Form 49B online, e-KYC, ~1 week — deducting without TAN invites its own ₹10,000 penalty. Then lock the quarterly rhythm: deduct on payment/credit → deposit by the 7th next month → file 24Q/26Q by quarter-end+1 month → issue 16/16A. Four beats, every quarter, no improvisation. Deductors who calendarise this once never think about TDS again; deductors who don't fund the 234E fee pool.

By TaxSetu Editorial Team · Last reviewed: 7 October 2026

Based on the Income-tax Act 2025, Income Tax Rules 2026 and CBDT notifications; sections per the Income-tax Act 1961 (as amended) with 2025-Act mappings where notified · Verify on the official portal: incometax.gov.in

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Frequently Asked Questions

Apply online via Form 49B — allotment takes about a week. Quote TAN on all TDS paperwork; 194-IA/IB/194M (26QB/QC/QD) don't need one.

₹200 per day under 234E (capped at the TDS amount), plus 1%/1.5% monthly interest for late deduction/deposit. Returns are due 31 Jul/31 Oct/31 Jan/31 May.

Deduct at 20% (or the higher applicable rate) under 206AA — always collect PAN before paying.

A lower/nil-TDS certificate the payee gets via Form 13 — if your vendor shows one, deduct exactly at its printed rate. TDS chart.