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    FAQs: Higher TDS/TCS for ITR Non-filers


Q1. When is TDS/TCS applicable at a higher rate for resident customers?

Higher TDS/TCS shall be applicable if following conditions are satisfied:

  • a) You have not filed Income Tax Return for previous 2 financial years for which the time frame for filing original return of income (other than belated return of income) as prescribed under Income tax laws has expired; and
  • b) Total TDS and TCS deducted and collected in your case was equal to or more than Rs. 50,000 in such previous 2 financial years.

Q2. What are the rates at which TDS/TCS will be applicable if you are ITR non-compliant as mentioned in point no. 1 above?

If you are ITR non-compliant, then TDS/ TCS will be applicable w.e.f. 1st July 2021 at following rates:

Sr. No. Section Nature of Payment Exemption Limit for a Financial Year  Normal TDS/TCS Rate 
TDS/TCS Rate if PAN not
 available or ITR non-complied 
1 194A Interest on Fixed Deposits  Rs. 40,000 (Rs. 50,000 in case of Senior Citizens)  10% 20%
2*   206C(1G)   TCS on foreign remittances Rs. 7,00,000 per buyer* 5% 10%
3** 206C(1G)
 TCS on remittances for education 
funded through education loan
Rs. 7,00,000 per buyer 0.5 5%
* Exemption limit of Rs. 7,00,000 per buyer will not be applicable in case foreign remittance is for the purpose of overseas tour.
** TCS shall not be collected if the buyer is liable to deduct tax at source under Income Tax Act and has deducted such amount.

Q3. When is TDS/TCS applicable at a higher rate for non-resident customers?

Higher TDS/TCS shall be applicable if you (non-resident customer) have a Permanent Establishment in India (which includes a fixed place of business through which the business of the enterprise is wholly or partly carried on), and satisfy both the conditions (as applicable to resident customers) mentioned in point no. 1 above.

Q4. Am I required to submit any documentary proof with the bank evidencing that I am ITR compliant?

In case wherein you have submitted late Income Tax Return, you will be required to submit a documentary proof along with a declaration with bank branch evidencing that you are ITR compliant.
Post receiving such documents, branch personnel will verify the same and TDS rate will be updated in system within a period of 5-7 working days from the date of receipt of such documents.

If you have any further queries on this, please visit your nearest AU Bank branch.

*All the above information is subject to change without prior notice by the bank. This document is only for the purpose of guidance. Please contact branch representative for any clarification or exact implication in your account.

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