| Question And Answer | |
|---|---|
| Subject: | TDS credit appearing in Form 26 AS of next year |
| Category: | Income-Tax |
| Querist: | CA. Ankit Tantia |
| Answered by: | Advocate Neelam Jadhav |
| Tags: | TDS credit |
| Date: | May 14, 2023 |
As per section 199 read with sub-rule (3) of rule 37BA, credit for tax deducted at source and paid is given for the assessment year for which such income is assessable. Accordingly, TDS needs to be claimed in the ITR based on income offered to tax in a financial year irrespective of the fact credit is appearing in future years in Form 26AS.
The query is how TDS credit will be given if the same is not appearing in 26AS, for example the income was offered in FY 22-23 but the TDS credit is appearing in 26AS for FY 23-24.
Suggestions are welcome.
Thanks
In the aforesaid situation, at the time of filling of the Return of Income, in the column of “Details of Tax Deducted at Source (TDS) on Income” in the sub-column “TDS credit being claimed this Year (only if corresponding income is being offered for tax this year), the assessee has to mention the correct TDS amount credit for the year, even though some were not reflected in 26AS for that year.
In terms of rule 37BA(3)(i), the benefit of TDS is to be given for the assessment year for which corresponding income is assessable, therefore, where the assessee received income on 31-3-2023, the benefit of TDS has to be allowed in the assessment year 2023 – 2024, even though the deductor inadvertently reported same in the assessment year 2024 – 2025.
In the case of Interglobe Enterprises Pvt Ltd v. ACIT, ITA No.6580/Del/ 2019 dt.07/06/2022 ( AY. 2016 -17), the tribunal held that Credit of TDS should be availed in the year in which income is assessed. The assessee shall be entitled to a credit of TDS corresponding to the income shown in the AY. 2016 -17
However, in another situation where the assessee raised an invoice on ‘A’ in March 2023, the benefit of TDS had to be allowed in the assessment year 2023-24, even though the tax on invoice amount was deposited by ‘A’ in April 2023.
Mahesh Software Systems (P.) Ltd. vs. ACIT [2020] 181 ITD 524 (Pune)(Trib.)
Anup Rajendra Tapadia vs. Dy. CIT [2023] 199 ITD 205 (Pune)(Trib.)
In the year in which the income is assessed, the assessee is eligible for credit of tax deducted at source.