Whether Nil Return of TDS is mandatory ?How to file Nil return after 01.10.2013 ?

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Whether Nil etds return is mandatory or not ?

The answer to this question remain controversial since beginning of  ETDS return system in year 2005.

Our answer to this question is No, Big No .

Nil etds return is not required to be filed as per Income Tax Act/Rules  and we have listed out Five reason to support our answer which has been listed out in post below.

However we have strongly recommends to the deductors that they should file NIL ETDS return not due to the reason that we have slight doubt in our mind that it may be mandatory to file etds return but due to benefit attached to filing NIL etds return ( we have given reason here ,why should you should file Nil TDS return and 5 tricks to save late fee for late filing of etds returns)


Reason-1 : Nil E tds return is not mandatory See Sub section (3)Section 200 of the income tax act. 

Provisions regarding filing of E tds statement is provided under under section 200(3) of the Income Tax Act ,which has been reproduced here under

200. (1) .........(2) ...............
(3) Any person deducting any sum on or after the 1st day of April, 2005 in accordance with the foregoing provisions of this Chapter or, as the case may be, any person being an employer referred to in sub-section (1A) of section 192 shall, after paying the tax deducted to the credit of the Central Government within the prescribed time, prepare such statements for such period as may be prescribed and deliver or cause to be delivered to the prescribed income-tax authority or the person authorised by such authority such statement in such form and verified in such manner and setting forth such particulars and within such time as may be prescribed.
As clearly mentioned in section "any person deducting any sum " is required to file etds statement . Means deducting of sum is compulsory to cover a person under above section .Further  If CBDT intentions are to make compulsory to file Nil etds return then wording of section should be like "every person holding  TAN must prepare and file etds return "which has not been placed in present case. Hence , Nil e tds return is not mandatory.

Reason -2 :Nil E tds return is not mandatory see sub rule(1) to rule 31A of Income Tax Rules
  
After Act ,Rule 31A(1) prescribe the format for returns and other particulars for filing etds return which has been reproduced here under.
Statement of deduction of tax under sub-section (3) of section 200.
31A. (1) Every person responsible for deduction of tax under Chapter XVII-B, shall, in accordance with the provisions of sub-section (3) of section 200, deliver, or cause to be delivered, the following quarterly statements to the Director General of Income-tax (Systems) or the person authorised by the Director General of Income-tax (Systems), namely:—
(a) Statement of deduction of tax under section 192 in Form No. 24Q;
(b) Statement of deduction of tax under sections 193 to 196D in—
  • (i) Form No. 27Q in respect of the deductee who is a non-resident not being a company or a foreign company or resident but not ordinarily resident; and
  • (ii) Form No. 26Q in respect of all other deductees.

Again under rules  also same words has been used  "Every person responsible for deduction of tax " which clearly states that etds return is required to field only if person is responsible for deduction of tax.So rules also confirm our answer that Nil etds return is not mandatory.

Third reason : Nil E tds return is not mandatory see section 234E late fee of late filing of etds return .


As you may aware that late fee of Rs 200 per day applicable for late filing of etds returns ,under section 234E ,which is required to be deposited before filing of late return .The section reproduced here under.


Late Fee u/s 234E for Late Filing of TDS Statement
“234E. (1) Without prejudice to the provisions of the Act, where a person fails to deliver or cause to be delivered a statement within the time prescribed in subsection (3) of section 200 or the proviso to sub-section (3) of section 206C, he shall be liable to pay, by way of fee, a sum of two hundred rupees for every day during which the failure continues.
(2) The amount of fee referred to in sub-section (1) shall not exceed the amount of tax deductible or collectible, as the case may be.”
As per sub section (2) to section 234E ,the amount of fee shall not exceed the amount of tax deductible or collectible  " virtually it means that no penalty/fee applicable on late filing /no filing of Nil etds return .

So if the intentions of CBDT are to make the filing of NIL tds return mandatory , CBDT might have also provided penal provision for non-filers and late filers of Nil etds return also.

Reason 4 :Nil return not mandatory New FVU 4.00 applicable from 01.10.2013.


You have recently Noticed that TIN-NSDL has released a New FVU 4.00 applicable wef 01.10.2013 under which it has been specified that etds  return having Nil challan without deductee details can not be filed.Which clearly supports our answer that a pure nil etds return can not be filed.


Reason 5:Nil return no mandatory ,TIN-NSDL website also said so .

In FAQ answered by TIN-NSDL regarding Form 24Q forth quarter ,Tin-nsdl has clearly mentioned that Nil etds return not mandatory ,Q/A reproduced hereunder.
Question If there is no deduction in a particular quarter, should I file the NIL statement?
Answer :The filing of a NIL statement is not mandatory.
so from the above 5 reasons we can easily conclude that Nil-Etds return is not mandatory at all.  
Advt.

How To  file Nil return after 01.10.2013

Now ,the question in  every bodies mind  is that when we have already established that Nil  return is not mandatory then why to learn "How Nil etds return can be filed "??

wait ........we have reasons for that also .In few situations Nil etds return filing may be beneficial for you ,so you should learn & file nil return as well(read 5 Tricks to save Late fee under section 234E)

But as mentioned above(reason-4) pure Nil etds return filing after 01.10.2013 not possible.Then how the question of filing Nil etds return arises ? 

wait...........a Minute ........To clear the dust over the issue, we have divided the Nil return in to two categories .
  1. Nil etds return which have only Nil amount challan and no deductee details (We have refered it as a Pure Nil e tds return )
  2. Nil tds return having Nil amount challan and having deductee details also with remarks tag "A " , "B" ,"T" ,"Z","Y"
First type of return i.e pure Nil etds returns has been dispensed with and can not be filed on or after 01.10.2013 but second type return still can be filed even after 01.10.2013 with FVU 4.00.

The Codes shown above have specific purposes  which has been described as under

  • Write "A" if "lower deduction" or "no deduction" is on account of a certificate under section 197. 
  • Write "B" if no deduction is on account of declaration under section 197A. 
  • Write "T" if no deduction is on account of deductee being transporter. PAN of deductee is mandatory.[section 194C(6)] 
  • Write "Z" if no deduction is on account of payment being notified under section 197A(1F). 
  • Write "Y" if no deduction is on account of payment below threshold limit specified in the Income-tax Act, 1961. 
The all of above entries have backing of rules also except code "Y" ."Y" code has not been mentioned any where in the rules.Relevant Rules reproduced here under

Rule 31A (4) The deductor at the time of preparing statements of tax deducted shall,—
(i) quote his tax deduction and collection account number (TAN) in the statement; 
(ii) quote his permanent account number (PAN) in the statement except in the case where the deductor is an office of the Government;
(iii) quote the permanent account number of all deductees;
(iv) furnish particulars of the tax paid to the Central Government including book identification number or challan identification number, as the case may be;
(v) furnish particulars of amount paid or credited on which tax was not deducted in view of the issue of certificate of no deduction of tax under section 197 by the Assessing Officer of the payee;(about Code A)
(vi) furnish particulars of amount paid or credited on which tax was not deducted in view of the compliance of provisions of sub-section (6) of section 194C by the payee;(about code-T)
(vii) furnish particulars of amount paid or credited on which tax was not deducted in view of the furnishing of declaration under sub-section (1) or sub-section (1A) or sub-section (1C) of section 197A by the payee.(Code-B)
(viii) furnish particulars of amount paid or credited on which tax was not deducted in view of the notification issued under sub-section (1F) of section 197A.(Code-Z)
So to create a Nil tds return after 01.10.2013 have two steps 
  1. Step :1:Enter challan details  
    • create a Nil amount challan (Check How to create Nil amount challan  here) as you have done previously or
    • Enter a any challan with amount deposited start date of financial year one year before the current financial year .You can enter challan deposited on or after 01.04.2012 for financial year 2013-14 (as per FVU 4.00 after 01.10.2013)
  2. Step-2 Enter at least one deductee details 
    • with any one tags code  A B T Z or Y  as describe above
    • A ,B & Z need certificate number also ,so that can be entered only if you have certificate number  issued by ITO tds 
    • Code-T is to be mentioned for payment made to transporter without deduction of tds under section 194C(6) 
    • More important is Code Y ,which is not mandatory ,but can help us in creating Nil etds return . With Y TAG you can enter payment under any tds section where cut off amount has been defined and you have paid/credited amount less than cut off amount and no tds has been deducted on it .
Note : Please note that while creating the etds return for a Given quarter you can enter deductee details from start of the financial year to end date of the given quarter.The same rule applies on deductee entries with above tags also. So in quarter -2 for fy 2013-14 ,you can enter any entries dated 01.04.13 to 30.09.2013.

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SECURITIES (MNP) (TDS)2007-08 ` 01.07.12 01.09.2008 01.10.2012 06.07.2009 07.08.2012 1 PERCENT EXCISE ITEMS LIST 1 sep 1% excise 10 year nsc 10(10C) 1000 court cases judgements supplied to ITO 1000 rupee note 11-2008 11-2010 130 items 14.08.2008 15 august 150 Rs coin 15g 15h 18-12-2009 192(1A) 192A 194 I 194A 194c from 01.10.2009 194H 194j 194LC 1981-2007 2% cst 2% excise 2004 2008 2008-09 FY 2010 206AA 234A 234B 234C 234c interest calculator 234E 23AC 23ACA 23B 24C 24q annexure II 25 paisa coin 271(1)(c) 271B 271H 272B 27A 280 280 challan 281 282 283 29 AUGUST 29.04.2010. 29/08/2008 29/2008 service tax 2g meaning use 3 idiots 30 MARCH 31st March 32-2010 33 of 2009 35(2AA) 35(2AB) 3CD 3g meaning use 40(b) 43B 44 AB EXEMPTED INCOME 44AA 44AB AGRICULTURE 44AB new limit 44AB NON RESIDENT 44ad 46/2012 45/2012 49C 5 day week 5 years post office deposit 5/2011 50 paisa coin 54b 54EC 54ee 54f 54gb 5th paycommission punjab 6 % excise 6 crore advance limit 6/2005 69/2010 6th cpc 6TH PAY COMMISSION 70% of pan etds 7th Central Pay Commission 8 tips to save tax 80C 80ccc 80CCD 80cce 80CCF 80CCG 80d 80DDB 80EE 80G 80GG 80GGA 80GGB 80ggc 80tta 80U 85% of pan etds 86/2008 DATED 13-08-2008 87A rebate 89(1) 89(1) relief calculator 9.5 % rate for private epf 92E 95% of pan etds 98 dated 04/01/08 aadhaar aakash tablet aam admi aar Aayakar Sampark Kendra abatement abolished ACCOUNT PAYEE DRAFT Accounting ACCOUNTING CODE accounting code for services ACCOUNTING FOR GOVT GRANTS accounting standards ACES ADD IN Add-Ins additional relief in budget 2010 adjustment of advance FBT with advance Tax advance rullings advance salary ADVANCE TAX CALCULATOR advance tax challan ADVANCE TAX CUT OFF AMOUNT ADVANCE TAX DATES AFFIDAVIT AG Projects Technologies Ltd RT age 80 addition pension aibea wage revision aibea wage revision latest news aiboa aiboc aiboc wage revision AIG AIR airline ticket booking tds airlines all is well allowances allownces alphabet of inspiration alteration on check allowed alternate minimum tax AMENDED 3CD amendment in companies bill 2011 amendment in gratuity act 2010 amendment in registration service tax AMENDMENT IN SERVICE TAX ON RENT amendment to finance Bill 2010 AMNESTY SCHEME 2007 amt Anna Hazare anna hazzare bill vs govt lokpal bill appeal apply for new pan card against old pan card aqb arbitration arrears of salary arrears of sixth pay ARRERS TAX AS-12 ASBA assessee in default ASSESSMENT REOPENING ASSESSMENT YEAR 2008-09 REFUND atm atm 100 per day atm cash without card atm tips atm wrong debit audit cases itr filing audit limit enhanced Audit Questionaire AUDIT REPORT AUS VS IND.INDIA VS SL Automated teller machine AUTOMATION OF CENTRAL EXCISE AND SERVICE TAX ay 2010-11 bad debts Bank Bank account bank audit bank audit 2012 bank charges BANK SALARY bank strike 06/07/09 and 07/07/09 banking law amendment banknotes banks npa provisioning BARE ACT bare rules BASE RATE BY BANKS bcct BIMAL JAIN biometric pan card black and white form not acceptable black money BLOCK PERIOD blogging bobay refund BONUS bonus share book discount BOOK ON EFILING BOOK REVIEW books of accounts BOOMING INDIAN ECONOMY both House rent allowance both hra and house loan Brass Scrap BRIBE CASE BROKER BSE bsnl broadband bsnl broadband usage bsnl land line sms alert BSR CODES BUDGET 2009 budget 2010 budget 2010-11 budget 2011 BUDGET 2012 budget 2013 BUDGET 2014 BUDGET 2014 CONTEST budget expectations BUDGET HIGHLIGHTS budget live on computer budget live telecast budget notification budget on tv budget speech BUDGET SPEECH DOWNLOAD Budget-2014 Budget-2015 BUDGET-2016 BUDGET08 Business BUSINESS AND PROFESSION MEANING BUSINESS COVERED UNDER 44ab BUY HOUSE C FORM CA CAN ONLY AUDIT MVAT CA CLUB INDIA CA GIRISH AHUJA CA NITIN GUPTA CA PARDEEP JAIN CA ROHIT GUPTA ca services CA sudhir Halakhandi CA Swapnil Munot CA Vikas Khandelwal calculate arrear CALCULATE NEW PAY calculate your emi calculation of tax on salary arrears CALCULATOR CALCULATOR REVISED capital asset capital formation huf Capital gain capital gain account scheme 1988 CAPITAL GAIN INDEX capital gain on repayment of loan capital gain on tenancy rights capital goods capital revenue CAPITAL SUBSIDY CAR LOAN RATE INCREASE carry forward of losses in late return cas cash flow statement CASH PAYMENT DIS ALLOWANCE CASH PAYMENTS EXCEEDING 20000 CASH SUBSIDY cbdt cbec CBI ARRESTED centeral sales tax rate CENTRAL PAY COMMISSION CENTRAL PROCESSING CENTER CENTRALISED PROCESSING OF RETURNS Cenvat CENVAT Credit Rules cgas 1988 challan challan 281 CHALLAN 289 challan correction challan Form 17 CHALLAN STATUS INQUIRY change change in cst rate change in excise duty rates CHANGE IN PAN ADDRESS CHANGE IN PAN DATA change in tds rates in budget changes CHANGES IN SERVICE TAX ACT changes in new itr forms CHANGES IN TDS CHARGES ON CASH PAYMENT OF CREDIT CARD BILL charitable organisation check name from PAN check tds deducted online Cheque cheque bounce cheque payment before due date cheque tender date /realisation date Cheque Truncation CHEQUE VALIDITY child care leave CHILD DEPENDENT PREMIUM CHILD MARRIED PREMIUM child plan childeren name children education allownces chip based atm card cibil cibil for companies CII 2007-08 CII 2008-09 CII 2010 cii 2012-13 CII2011-12 cin CIRCULAR 3/2010 DT 2.03.2010 CIRCULAR 8-2010 CIT v. Emilio Ruiz Berdejo (2010) 320 ITR 190 (Bom.) cloning of atm card clubbing of income COLLECTION CHARGES COLOR SCHEME COMMISSION ON SMALL SAVINGS common error in 2009-10 common error in itr 4-5-6 compa companies bill 2012 COMPANIES RATE COMPANY BILL 2011 company deposit Company Law Settlement Scheme COMPANY REGISTRATION complusory payment of taxes Composition scheme service tax COMPUTER AS FAX MACHINE computer sytem at ito office CONCEPT PAPER configure yahoo mail in outlook express consolidate account statement construction purchase of house Consultancy Service Consumer Price Index continues services CONTRIBUTION TO NEW PENSION SCHEME CONTRIBUTORY PENSION FUND CONVERT FIGURES INTO WORD EXCEL COPARCENER CorpMcash corporation bank correction etds CORRECTION IN PAN DATA correction in section CORRECTION RETURN CORRECTION RETURN.ETDS cost accounting cost audit cost inflation index cost inflation index 2012-13 COST INFLATION INDEX FY 2010-11 COST INFLATION INDEX FY 2011-12 COST OF INDEXATION CALCULATOR court case in entry tax punjab cpc phone number cpf Credit card CREDIT CARD BILL PAYMENT ICICI BANK credit scores cricket team critical illness CROSSED DEMAND DRAFT CRR crr reducred CS DIVESH GOYAL CST CST 3% OR 2 % cst act 1956 cst form CST FORM STATUS cst rate changed CST REDUCE RATE ctt currency CURRENCY TRADING ILLEGAL custom custom changes in budget cusual leave DA MERGE da rate da rate 01.07.2012 da rate january 2013 da rate july 2012 da rate wef 01.01.2012 date extension DDO ASK RENT RECIPT ddt dearness allowance Debit card DEBT EQUITY RATIO debt funds debt trap declared goods DEDUCTION 80C deduction for higher studies deduction on saving bank interst deduction u/s 80DD Deemed income of employee deemed services defective return defence officers defence pay defence pay scales DELAY IN FILING delete ledger in tally DELHI HIGH COURT demat deposit tax of two quarter in single challan depreciation depreciation on car depreciation on commercial vehicle. DEPRECIATION ON INTANGIBLE ASSETS depreciation rate depreciation rate 2009-10 DETAIL AFTER E FILLING DETAIL OF TIN Determination of value DIFFRENT TYPE OF TAXES digital signature din direct payment in bank account DIRECT SUBSIDY direct tax bill direct tax changes in budget direct tax code direct tax code 2009 Disability insurance discussion Paper distribution of salary dividend distribution tax dividend striping dnd do not call. document identification number document ientification number documents required for service tax registration domestic transfer pricing donation dot double taxation dow jones download download 89(1) relief calculator download direct tax code 2012 download form 16A download fvu download idfc INFRA BONDS FORM draft reply drawback rates dtaa dtc DUE DATE AY 2010-11 due date ay 2011-12 due date extended due date extended to 31.08.2012. due date for service tax return due date form 16 due date form 16a due date June due date march tax due date of return 2008-09 due date pf esi due date to deposit tds DUE DATES DUE DATES CALENDAR DUE DATES CALENDER DUE DATES INCOME TAX DUE DATES SERVICE TAX DUE FAMILY PENSION DULICATE PAN DUPLICATE TAN dvat e book Income Tax rules e book on service tax E ERA OF TAXES e filing do and don'ts e filing of audit report e filing processing status e filing software excel free e filing through evc e filing utilities e mode for notice to shareholder e notice to share holder e payment of epf E PAYMENT OF EXCISE DUTY e payment of income tax E PAYMENT OF SERVICE TAX e payment of tds E STAMP DUTY e tutorial for TAN registration E-1 FORM E-1 SALE e-commerce E-FILE SERVICE TAX RETURN e-Intermediary e-payment from friends account E-PAYMENT OF SERVICE TAX e-payment of taxes E-SEVA BY ICAI e-TDS/TCS statements earn from home earned leave Easy Exit Scheme ebay EBOOK EBOOK ON SERVICE TAX economic survey economic survey 2010 economic survey 2011 economic survey 2012 Edible Oils EDITABLE INCOME TAX FORM education cess EDUCATION LOAN eet EFFECTIVE DATE CST RATE REDUCTION effective date of allowncs efiling errors efiling free efiling income tax return efiling of excise return efiling registration problem Electricity act ELECTRONIC FOREX TRADING Electronic Verification Code (EVC) elegent card on holi ELSS EMANAGEMENT OF TAXES EMI CALCULATOR empanelment as branch auditor EMPLOYEE PROVIDENT FUND employee state insurance employee state insurance act 1948 employee state insurance act Limit employer e sewa eMudhra Consumer Services entries r off in 50 paisa entries rounded off in rs ENTRY TAX entry tax punjab epf epf challan epf claim epf e passbook EPF FAQ epf int rate 11-12 epf interest exemption epf interest rate epf interest rate for fy 2010-11 epf limit epf online EPF ONLINE CHALLAN G