Penalty for Late Filing of TDS Return
Tax Deducted at Source (TDS) serves as a crucial mechanism within India’s tax administration framework, designed to ensure timely tax collection and reduce tax evasion. According to the Income Tax Act, 1961, specific individuals are required to withhold tax at designated rates when making certain payments, including salaries, rents, professional fees, interest, and other specified transactions. While this system guarantees a steady revenue stream for the government, failure to adhere to TDS regulations can result in severe penalties for both the deductors and the deductees.