Form 27: What is Form 27, and why is it significant? | HRMantra HR Software

Form 27: What is Form 27, and why is it significant? | HRMantra HR Software

5-6 minutes

TCS stands for Tax Collected at Source. The government first used this system to correct what it called the inefficiency of tax collected from the sale of goods taking place in India. Here, taxes are to be got by the seller from the buyer at the time of buying. Upon collecting, the seller is supposed to deposit the collected TCS amount within a stipulated period with the division—Personal Tax.

Moreover, all deductors and collectors, both governmental and nongovernmental, are required to file Form 27EQ on a quarterly basis under Section 206C of the Income Tax Act at the end of the particular quarter.

Form 27EQ is a statement providing details about the sources from which tax has been collected. Non-filing of the same can attract penalties.

Continue reading to know more about the rules related to Form 27EQ.

Table of Content

• Meaning of Form 27EQ
• Who is required to submit Form 27EQ?
• Sections of Form 27EQ
• Salient Features of Form 27EQ for TCS Returns
• Easy Steps to avail Form 27EQ Download Process
• Form 27EQ: Late Filing Consequences
• FAQs

Meaning of Form 27EQ

Form 27EQ is a statement providing details about the sources from which tax has been collected. It is mandatory for all deductors and collectors, both governmental and nongovernmental, to file Form 27EQ on a quarterly basis under Section 206C of the Income Tax Act at the end of the particular quarter.

Who is required to submit Form 27EQ?

It may be a tough task getting all details submitted accurately and within the stipulated deadline. The saving grace remains that only the following individuals and organizations need to file Form 27EQ, that too solely in the event of furnishing details of TCS from the buyers:

• Government deductors and collectors
• Non-government or corporate deductors and collectors

Sections of Form 27EQ

The various categories in Form 27EQ are broken down into the following sections:

Section 1

Under this section of the form, the following fields need to be filled by a deductor:

• TAN (Tax Deduction and Collection Account Number)
• PAN (Permanent Account Number)
• Assessment year
• Fiscal year
• Tick for statements filed
• In case yes, a statement receipt number

Section 2

The following details must be provided by a person in charge of ascertaining information:

• Name of the collector
• Division or branch if any of the collector
• Personal details like Address, Contact Details, and Email ID

Section 3

The collector who is responsible for collecting charges shall furnish the following information in this regard:

• Name
• Address

Section 4

This section requires information with respect to tax deducted/collected at source and deposited with the Central Government. Please fill in the following details:

• Collection code
• Amount of tax which has been collected at source
• Education Cess Amount in general
• Overcharge amount
• Amount collected through interest charged
• Additional charges/amount, if any
• Total sum of all mentioned sums i.e. total tax deposit
• BSR code
• Date of deposit of total amount of tax
• No. of cheque or demand draft
• Sl.No. of voucher of the transaction or challan
• Also to state whether TCS is booked through book entry u/s 5

Conclusion

At the end, being a taxpayer under this form, details of the annexure related to tax collection and payment also need to be provided. It has to be signed by them also.

Key elements of Form 27EQ for TCS Returns

What are the features of Form 27EQ?

• Form 27EQ is a declaration made to the Income Tax Department regarding the TCS that has been withheld by the seller.
• The rules and the mode of granting of section 206 of the Income Tax Section prescribe the features.
• Government and corporate deductors and collectors must file Form 27EQ every quarter.
• The applicant must possess a Tax Deduction and Collection Account Number while filing this form.
• Government - ''PANNOTREQD'' shall be filled in this form of government deductors. In the case of non-government deductors, PAN is to be filled in the form.

Simple Steps to Download Form 27EQ

You can download Form 27EQ by following the given steps:

1. Open the website of NSDL.
2. Click on the ''Download'' option available in the menu bar. Click on ''E TDS/E TCS''.
3. Select ''Quarterly Returns.'' Then go for the option ''Regular''.
4. Then you have to click on ''Forms'' given on the page. Now you have to click on ''Form 27EQ''.
5. The form will open up. In the right corner, you will find options to download or print it.

Form 27EQ: Penalty for Late Submission

Late submission of Form 27EQ attracts a penalty in addition to the penalty imposed for delaying TCS return filing. The penalty is as follows:

Form 27EQ under Section 234E

If Form 27EQ under Section 234E is filed late, then this form is not sent; a daily penalty of Rs. 200 will be levied until the authority or the deductor submits the return along with this form. The maximum liability on which the penalty levied cannot exceed the TCS amount.

Non-filing of Form 27EQ under Section 271H

On failure to file this form before the specified calendar year ends, the Assessing Officer has the discretion to impose a penalty. The quantum of this penalty ranges between Rs 10,000 and Rs 1,00,000 depending upon the gravity of the violation.

Frequently Asked Questions

What is Form 27Q for TDS return?

Form 27Q is a declaration or return that contains details of TDS on payments made to NRIs and foreigners excluding salary payments. It is meant to be filed quarterly well before the date.

What happens if the seller does not collect TCS on time?

If any seller does not collect TCS on time, then they have to pay 1% interest per month until the tax has been collected. Also, they have to pay the penalty if they are not filing TCS returns and not submitting Form 27EQ on time.

Is Form 27EQ filed quarterly?

Yes, Form 27EQ is filed on a quarterly basis.

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