01 July 2022 marked another important date for the TDS provisions. It marked the introduction of new sections under the TDS chapter of the Income Tax, 1961. It remains in line with the directive of the government to bring more and more accountability and transparency in the economy. This time the government targeted new areas of the TDS application.
The recon of the 34A is probably the most crucial recon of the Form 3CD.
Usually, companies take the data as filled out in the TDS returns filed during the year and submit the same with the details from all the quarters.
There has been confusion regarding this hot topic. The question is simply that if a business needs to reconcile then it should reconcile with 16A issued by the deductors or the tax credit statement of 26AS. To resolve this confusion, we need to be back to basics of the TDS receivable reconciliations.
This Diwali marked the completion of First Quarter of TDS u/s 194Q which was implemented w.e.f. 01 July 2021 and also the completion of First year of TCS u/s 206C 1H which was implemented w.e.f. 01 Oct 2020.
The new provisions have affected the cash flow of many industries by impacting how their transactions are taxed.
“When the business is so tightly knotted with tax policies and the system of credit claiming with the features of the cross assessment, there cannot be any board meeting complete without the due discussion on the tax function”
