10 Questions
What happens to an INOPERATIVE PAN in terms of TDS?
It attracts the same TDS as NOPAN
What is an INOPERATIVE PAN?
A PAN that is not linked with AADHAAR
What is an INVALID PAN?
A PAN that is not matched with NSDL site
What happens to an INVALID PAN in terms of TDS?
It attracts the same TDS as NOPAN
What is NOPAN?
A PAN that is not provided
What is the primary purpose of Tax Deducted at Source (TDS)?
To collect indirect tax by the Government of India
Under which Act is TDS governed?
Income Tax Act, 1961
Why is tax deducted at source by a bank?
If total interest paid/ payable on all term deposits held by a person exceeds the specified amount
What is the purpose of the bank's PAN?
For tax assessment purpose and wherever there is a requirement to quote the same
What is the significance of centralizing Payment of TDS under various sections of Income Tax Act, 1961?
To simplify the process of TDS payment
Study Notes
TDS (Tax Deducted at Source)
- A system of collecting indirect tax by the Government of India as per the Income Tax Act, 1961
- The bank has a statutory obligation to deduct tax at source if total interest paid or payable on all term deposits held by a person exceeds a certain amount specified under the Income Tax Act
Bank's Obligations
- The bank deducts tax at source if the total interest paid or payable exceeds the specified amount
- The bank's PAN (Permanent Account Number) is AAACU0564G
- The bank uses this PAN for tax assessment purposes
- The PAN is quoted wherever required
This quiz covers the implications of Inoperative/Invalid PAN on TDS. Learn how Inoperative PAN, not linked with Aadhaar, and Invalid PAN, not matched with NSDL site, attract TDS.
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