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How to File TDS Returns: Guide for Small Business Owners


How to File TDS Returns: Guide for Small Business Owners

For small business owners, filing Tax Deducted at Source (TDS) returns is a key part of compliance. Certain payments made by businesses are subject to tax deductions at the source through a method called TDS. These deductions must be reported and the necessary information must be provided to the tax authorities when filing TDS returns.

Small business owners have to gather necessary data before filing TDS returns. Getting a Tax Deduction and Collection Account Number (TAN) and collecting details on the deductees are part of this.

Obtain TAN (Tax Deduction and Collection Account Number)

A TAN is a special identification number necessary for withholding and collecting taxes at the source. Small business owners can go to the tax authority’s official website, fill out the TAN application form with the required information, provide supporting documentation, and pay any required costs to receive a TAN. The business will be able to deduct and submit taxes after receiving the TAN, which will be issued after verification.

Collect details of deductees

Deductees are people or organizations from whose taxes have been withheld at the source. Deductees’ names, addresses, Permanent Account Numbers (PANs), and the amount of tax deducted must all be gathered by small business owners. For correctly submitting TDS returns and providing TDS certificates to deductees, this information is essential. To ensure compliance with tax laws, it’s crucial to keep accurate records and documentation.

Prepare TDS Return:

1. Choose the appropriate TDS return form

Small business owners should choose the right form to prepare TDS returns based on elements including payment type, deductee type, and relevant tax law sections. Usually, TDS return forms are arranged quarterly (for example, Q1, Q2, Q3, Q4). Compliance requires careful form selection. The relevant TDS return form can be found on the website of the tax authority, or you can ask a tax expert for advice.

2. Access the online TDS filing portal or use third-party software

Small business owners can access the online TDS filing portal offered by their country’s tax authority or use third-party software to submit TDS returns. Businesses can directly upload TDS return files through online portals provided by tax authorities, while third-party software streamlines the filing process with user-friendly interfaces and functionality. Choosing between the two possibilities depends on personal tastes and the resources at hand.

3. Fill in the necessary details in the form

Small business owners should guarantee accuracy and completeness while completing the TDS return form. They must contain information like TAN, financial year, quarter, deductee PAN, name, address, amount of tax deducted, mode of payment, and the section that is appropriate for the deduction. Any exemptions, deductions, or corrections should also be mentioned, along with any relevant supporting documentation. To preserve compliance and reduce errors, it is essential to carefully review and validate all data before submitting the form.

Validate and Generate TDS Return:

1. Review the entered information for accuracy and completeness

It is essential for small business owners to carefully review the entered information after entering the relevant information in the TDS return form. They must make sure that all information is accurate and comprehensive, including the TAN, deductee information, tax deducted amounts, method of payment, and pertinent sections. To prevent fines and ensure compliance, it is crucial to check for errors, omissions, and inconsistencies. A comparison of the data with any supporting document is advised, and any differences should be corrected. The TDS return can be created and submitted to the tax authorities once the accuracy has been confirmed.

2. Validate the TDS return using the built-in validation utility

Small business owners can use the built-in validation utility offered by the online TDS filing site or third-party software to verify the TDS return. This tool aids in finding any errors or discrepancies in data supplied, such as incorrect PAN numbers, missing fields, or inaccurate tax amounts. Business owners can make sure that the TDS return complies with the appropriate format and meets the requirements set forth by the tax authorities by running the validation software. Correcting any errors before completing and submitting the TDS return is a crucial step.

File TDS Return

1. Generate the TDS return file in the accepted format (e.g., FVU, TXT, ZIP)

Small business owners should generate the TDS return file in the acceptable format as defined by their country’s tax authority after validating the TDS return. FVU (File Validation Utility), TXT (plain text), and ZIP (compressed file) are examples of commonly used formats. The relevant option within the online TDS filing portal or the export feature of third-party software might be chosen to do this. The resulting file will include all pertinent information from the TDS return in a structured style and be prepared for electronic submission to the tax authorities or other filing requirements.

2. Log in to the online TDS filing portal

To log in to the TDS filing portal online:

  • Visit the tax authority’s website for your country.
  • Go to the TDS filing section.
  • Find the sign-in or login option.
  • Enter your username and password in the spaces given.
  • If more security verification processes are needed, complete them.
  • Upon successful authentication, go to the dashboard of the portal.
  • To upload the created TDS return file or to enter the necessary information directly, follow the instructions.
  • Review the entry and verify the filing procedure.
  • For future reference, keep a copy of the acknowledgment/receipt.

3. Upload the generated TDS return file

  • Log in to the TDS filing website.
  • Go to the dashboard or section for TDS filing.
  • Find the TDS return file submit or upload option.
  • By selecting the upload or browse button, choose the file from your device.
  • Ensure that the file is in the acceptable format that the portal has provided.
  • Click the upload or submit button to start the file transmission.
  • Ensure that the file is successfully sent by waiting for the upload procedure to be finished.
  • Look for any confirmation messages or notifications to confirm the transfer was done.
  • Verify the submitted file to make sure the data is accurate and comprehensive.
  • By the portal’s instructions, confirm the submission.
  • Keep a copy of the acknowledgment ythat is produced following a successful submission for your records.

 4. Authenticate the submission using digital signatures (if applicable)

Use digital signatures to verify the submission of the TDS return, if necessary. The filing procedure is made more secure and authentic by the use of digital signatures. Utilize a valid digital signature certificate to digitally sign the return by following the procedures given by the online TDS filing portal. This contributes to ensuring the submission of the TDS return’s integrity and non-repudiation.

5. Obtain an acknowledgment receipt or token for future reference

Obtain an acknowledgment receipt or token after successfully submitting the TDS return using the web portal for your records. This receipt, which serves as submission proof, includes crucial details like the acknowledgment token or number. This receipt should be kept on file in case it becomes necessary for any upcoming investigations, audits, or compliance requirements.

Pay TDS Late Filing Fees (if applicable):

1. Determine if any late filing fees are applicable

Refer to the tax regulations and instructions issued by the tax authority to determine whether any late filing penalties are relevant for TDS returns. These regulations outline the deadlines for submitting TDS returns and the consequences of filing them late. Check the regulations to see if late filing fines are necessary, and then determine the appropriate amount. Keeping up with regulations enables timely compliance and prevents fines.

2. Calculate the fees based on the number of days delayed

Small business owners should consult the unique penalty structure established by their country’s tax authorities to calculate the late filing fees for TDS reports based on the number of days delayed. Usually, a percentage or a set sum is charged for each day that submission is late. To determine the total fees, multiply the applicable penalty rate by the number of days the return is late. It’s crucial to adhere to the instructions given by the tax authority to correctly calculate and settle the necessary late filing fees.

3. Pay the fees through the designated mode (online or offline)

Follow the instructions provided by the tax authority regarding the preferred method of payment to pay the late filing fees for TDS returns. It might be offline or online. To pay the fees within the allotted period, use the designated payment method, such as Internet banking or in-person payment at accredited banks.


In conclusion, small business owners must fulfill their obligations to deduct and remit taxes by filing TDS returns to ensure compliance with tax laws. The tax and compliance service provider Kanakkupillai, who has experience in getting TAN, collecting deductee information, validating forms, and accurately submitting them, can help with understanding the complexity of filing TDS returns. You can rely on Kanakkupillai to simplify the TDS return filing procedure and guarantee prompt compliance.


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