What this covers
Running the deduction and collection of tax at source properly — identifying which payments attract deduction and at what rate, depositing on time, filing the quarterly statements, issuing certificates to the people you have deducted from, and correcting the mismatches that otherwise surface as departmental notices.
Statutory basis
The tax deduction and collection provisions of the Income-tax Act, 2025, and the corresponding rules of the Income-tax Rules, 2026. Deduction obligations attach by the nature of the payment — salary, interest, contract payments, professional fees, rent, commission, purchase of goods, and payments to non-residents, each with its own rate and threshold. Higher rates apply where the recipient has not furnished a permanent account number. For periods up to 31 March 2026 the corresponding provisions were Chapter XVII-B of the 1961 Act, with the familiar section numbers in the 192 to 195 range and collection at source under section 206C.
Who it applies to
Every person making a payment of a kind the Act covers, above its threshold. That includes entities with no tax liability of their own — a loss-making company and a charitable trust both still have to deduct. Individuals and Hindu undivided families are outside most of the business-payment provisions unless their turnover crosses the prescribed limit, but are inside the provisions on rent above the threshold and on the purchase of immovable property, which is where an individual most often discovers the obligation late.
What we do
- 1Map your recurring payments to the provision, rate and threshold that applies to each, and put that map where the person raising the payment can see it.
- 2Check the recipient's permanent account number and, where relevant, whether a lower or nil deduction certificate has been obtained.
- 3Deduct at the point the Act specifies — for most payments the earlier of credit or payment, which is why a year-end provision can create a liability nobody noticed.
- 4Deposit by the monthly due date and keep the challan reference against the entry.
- 5File the quarterly statement, and reconcile it to the ledger before filing rather than after the default notice arrives.
- 6Issue the certificates on time, and clear defaults on the department's portal — short deduction, short payment and mismatched challans each need a different correction.
What you receive
- Deduction map
- Your actual payment types mapped to provision, rate and threshold.
- Monthly working
- The deduction working and the challans, reconciled to the books.
- Statements filed
- Quarterly statements filed, with the acknowledgements.
- Certificates
- Annual salary certificates and quarterly certificates for other deductions, issued to recipients.
- Default resolution
- Where defaults exist, the corrections filed and the position closed rather than left open.
Documents and information required
Tax deduction account number and portal credentials · vendor and employee master with permanent account numbers · ledger of payments for the period · existing challans and returns for the year · lower or nil deduction certificates held · salary structures and employee declarations · agreements for rent, contracts and professional services · details of payments to non-residents with the remittance papers.
Key dates
Deposit by the 7th of the month following deduction, with a later date for deductions made in March. Quarterly statements for tax deducted are due at the end of the month following the quarter — 31 July, 31 October and 31 January — and 31 May for the quarter ended 31 March. Statements for tax collected run on the 15th of those months instead, which is a distinction worth keeping straight, because filing on the collection schedule makes every deduction statement late.