Simple Guide to Online eTDS Payment

Tax Deducted at Source otherwise called TDS is a method of Income Tax collection by the Indian Government. The TDS is designed to enforce income tax collection by the Government at the point of transaction. This is intended to reduce the risk of tax default risk and ensure that tax is collected timely. In this article, we will learn about TDS deposit online.

TDS Payment

The person paying the income deducts the TDS which means that the tax is deducted at source. The payee then deposits the deducted income tax into the account of the income tax department as TDS payment. Therefore, TDS payment is defined as the income tax paid by the recipient at the period of his assessment.

TAN Registration

TAN registration (TAN) is a ten-digit alphanumeric number given to all responsible persons in tax collection and deduction. All those tasked with tax collection at source on behalf of Income Tax Department are mandated to obtain TAN.

When are TDS Deduction and Payment Required

The income gotten from the sources below is subject to tax deduction at source:

  • Salary and all other positive incomes ( Section 192 )
  • Interest on securities ( Section 193 )
  • All other interest aside from that on securities( Section 194A )
  • Payments made to contractors and sub-contractors( Section 194C )
  • Lottery winnings ( Section 194B )
  • horse races winnings ( Section 194BB )
  • Commission for insurance which covers all payments for obtaining Insurance business( Section 194D )
  • Any interest aside from that made on securities to be paid to non-residents and not to the company (Section 195 )
  • Payment to sportsperson including sports association. For a non-resident sportsperson, payments for advertisements and articles on any sports in India in is included( Section 194E )
  • Payment regarding deposits under NSS[National Savings Scheme]( Section 194EE )
  • Mutual Funds Payment repurchase ( Section 194F )
  • Commission or brokerage ( Section 194H )
  • Payment of rent ( Section 194I )
  • Professional and technical services fees ( Section 194J )
  • Commission paid to buyers and sellers of Lottery tickets which includes remuneration on such tickets(Section 194G )
  • Income from the purchased unit in foreign currency or profit from the transfer of foreign currency units ( Section196B )
  • Income payment to non-residents in regards to interest or dividend on bonds and shares( Section 196C )etc.

Procedure for making online TDS Payment

To make TDS deposit online, go to the Payment System website –  and follow the following steps:

  1. Select the applicable challan online
    1. Income Tax Challan No ITNS 280
    2. Income Tax Challan No ITNS 281
    3. Income Tax Challan No ITNS 282
    4. Income Tax Challan No ITNS 283
  2. Input its applicable PAN / TAN. The validity of your PAN / TAN entered will be checked online.
  3. If PAN/ TAN is valid, the taxpayer can then proceed to fill other challan details such as accounting head, TAN name, and address and bank through which payment will be made, etc.
  4. After the submission of data, a confirmation screen will be displayed. Upon confirmation of the challan entered by the taxpayer, it will be directed to the bank’s net-banking site.
  5. The taxpayer will log in with the unique id an password generated by the bank for the net-banking purpose to input payment details at the bank site.
  6. After successful payment, a CIN number will be displayed as well as the payment details and bank name in which the online payment has been made. This serves as the proof of TDS deposit online.

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