TDS Challan ITNS 281 and consequences in case of delay
A simple guide on TDS challan 281
In this post, we will discuss TDS Challan ITNS 281, its purpose, how to file it, and the consequences of delayed payment. Whether you’re a taxpayer or a deductor, this guide will help you understand everything from filing steps to penalties and FAQs.
We will cover the following:
What is TDS Challan ITNS 281?
TDS Challan ITNS 281 is used for depositing Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). It was introduced to minimise the payment errors and facilitate the online transmission of details of tax collected & deposited.
History of Challan ITNS 281
In 2004, the Government of India brought in the Online Tax Accounting System (OLTAS) to replace the old manual way of collecting taxes. The idea was simple: reduce human work, cut down on mistakes, and make it easy to track tax details like payments, refunds, etc., all online.
Now, under OLTAS, only one copy of the Challan is given, and you can easily check its status online, whether it’s paid through a paper challan or electronically through the bank.
There are three main types of challans used:
|
1. |
Challan ITNS 280 |
For paying Income Tax, like advance tax, self-assessment tax, or tax on regular assessments. |
|
2 |
Challan ITNS 281 |
Used for paying TDS (Tax Deducted at Source) or TCS (Tax Collected at Source). |
|
3 |
Challan ITNS 282 |
Meant for paying taxes like STT (Securities Transaction Tax) and other direct taxes. |
In short, OLTAS made tax payments and tracking a lot simpler and more transparent.
Steps to pay via TDS Challan ITNS 281?
Citizens of India, including corporations and non-corporate entities, can pay through TDS Challan ITNS 281.
Would you like to know how to submit your TDSchallan ITNS 281 online? Please scroll down if so.
Online :
In order to pay via TDS Challan ITNS 281 online, please follow these steps:
- Login to ITD Portal and navigate to e-pay option
- Then select Challan No./ITNS 281 (Tax deduction/collection at Source)
- To proceed, provide the necessary information, such as the payment section, payment amount, payment method, bank name, etc.
- The confirmation screen will display. Double-check the information you submitted.
- Simply click “Submit to bank“
- It will take you to the bank’s online banking page.
- To use net banking, enter the user ID and password issued by the bank.
- Enter the payment details, i.e. the amount to be paid
- Select “Submit”
- A challan counterfoil including the CIN number, payment information, and the bank name used for the e-payment will be displayed upon successful payment.
Offline :
Likewise, to pay via offline (bank counter) please follow these steps:
- Based on the type of payment and deductee, calculate the total TDS payable. In addition, if interest is applicable, you should calculate the rate.
- Download TDS Challan ITNS 281 in PDF format.
- Take a printout of the challan.
- Submit the duly filled out form along with the required TDS amount at your nearest bank.
- After you submit, the bank will provide you with a stamped receipt as proof of payment.
Due date for paying TDS through Challan ITNS 281
The payment date of Tax (TDS/TCS) is accounted for when the deductor pays the tax via Challan ITNS 281 to the bank. Therefore, it must comply with the timelines laid out for depositing the tax.
Due dates for the TDS payments are:
- TDS deducted on salaried or non-salaried payments- 7th of the next month.
- TDS deduction on salaried or non-salaried payments in March – 30th April.
- Deduction of TDS on the purchase of immovable property – 30th of the next month.
Consequences in case of delay
In case of any delay in depositing the tax, interest is levied at the rate of 1.5% per month from the month of deduction.
For example, the TDS for the month of October 2024 was deposited on December 15, 2024. In this case, the due date of payment was November 7, 2024. However, the payment is delayed for three months, i.e., from October to December (from the month of deduction to the month of payment), interest at the rate of 4.5% will be payable.
How to check the challan status online
On the Tax Information Network website, the status of challan deposited can be viewed. The taxpayer can check the status after three working days of payment of challan.
The payer can view the status challan-wise or for all the challans paid under a TAN for a particular duration. According to the type of view, the taxpayer must submit the information as listed below:
- CIN-Based view:
- BSR Code of the collecting branch
- Challan Tender Date (Cheque/Cash deposit date)
- Challan Serial No.
2. TAN-based view:
- Tax Deduction/ Collection Account No. (TAN)
- Challan payment period
You can view various details about your challans through this feature.
You can view various details about your challans through this feature.
Using CIN (Challan Identification Number):
- BSR Code of the bank
- Date you paid the challan
- Challan Serial Number
- Amount paid (if you entered it)
- Major Head Code and its meaning
- PAN or TAN
- Name of the taxpayer
- Date when TIN (Tax Info Network) got it
Using TAN (Tax Deduction Account Number):
- CIN details
- Major Head Code and its meaning
- Minor Head Code
- Nature of Payments
Details which are required to be filled
- Tax Applicability: It is the first column of the form.
- 0020: This is applicable in the case of the income tax of companies. If the deductee is a company such as ABC Ltd. then you need to select code 0020. Whether or not an entity is a company can be checked by the PAN no. of the entity, the fourth letter of the PAN No. shall be “C” in the case of a company.
- 0021: This is applicable to income tax for other than companies, i.e., if the deductee is not a company, it may be an individual, HUF, partnership firm, etc.; then you need to select this code.
- Assessment year: It is the year in which you assess the tax regarding the income earned during the previous year.
- TAN, name and address: You have to enter the TAN no. and the name of your company.
- Type of payment: It relates to the TDS payment category.
- If the taxpayer pays the tax on a monthly basis on his own, then tick on “TDS / TCS payable by the taxpayer”.
- If the tax is paid by the taxpayer based on the demand raised by the Income Tax Department, then tick on “TDS/TCS Regular Assessment (Raised by IT Department)”
- Nature of Payment: Code as per the section under which TDS/TCS is deducted is to be filled.
Penalties for late TDS payments
There are penalties in the form of additional interest payments for late TDS payments and TDS return filing. The type of delay affects the rate of this interest payment
- Delay in TDS deduction – 1% of the TDS per month or part thereof
- Delay in depositing the deducted TDS – 1.5% of the TDS per month or part thereof
- Hold up in TDS return filing – Rs 200/day subject to a maximum of the actual TDS amount. Moreover, if the delay is for a year and above, the penalty might range between Rs. 10,000 to Rs 1 lakh.
We’ve reached the end! Feel free to leave feedback or questions in the comments box below; we’ll be happy to help.
FAQs
Q. Is TDS Challan ITNS 281 still used?
Ans: Yes, the challan is now digitized and paid through the e-filing portal.
Q. What is Challan Identification Number?
Ans: Challan Identification Number (CIN) is a number that proves your tax payment is done. It has three parts, first is the 7-digit BSR code of the bank branch where you paid the tax, second is the date you paid it (like DD/MM/YY), and third is the challan serial number given by the bank.
Q. Can I submit Challan ITNS 281 without a TAN?
Ans: No, TAN number is a must. Without TAN, you can’t pay TDS using Challan ITNS 281. This is as per Section 203 of the Income Tax Act, 1961.
Q. What information can be found on a TDS challan ITNS 281 with a CIN acknowledgement stamp?
Ans: The TDS challan with the acknowledgement stamp displaying CIN includes the name of the branch, date of deposit, serial number, and BSR number.
