TDS you deduct — challans, 26Q and Form 16A

Record the TDS you withhold when paying vendors, deposit it by challan against your TAN, and hand your CA a ready 26Q workbook plus Form 16A working copies each quarter.

TDS has two sides, and Finocket keeps them strictly apart. As a deductee, your clients withhold tax while paying you — that money is credited to your PAN and reconciled against Form 26AS on the TDS summary. As a deductor, YOU withhold tax while paying vendors — contractors, rent, professional fees — and that money must be deposited against your TAN and reported every quarter in Form 26Q. The TDS hub shows both sides as two separate tabs so the numbers can never blur into each other.

Set up your deductor profile

Open Profile → Business and fill the TDS deductor profile card: your TAN (the 10-character AAAA99999A number — separate from your PAN), the deductor type, and the person responsible for deduction with their designation and PAN. These details print on every 26Q working paper and Form 16A copy, so add them before your first quarter-end.

Record TDS as you pay vendors

On Add expense, switch on “I deducted TDS on this payment”. Pick the section (194C contract, 194J professional fees, 194I rent, …) and Finocket suggests the standard-rate amount — adjust it if your case differs. Enter the supplier's PAN: without it, section 206AA can force deduction at 20%, so Finocket flags every PAN-less entry rather than silently letting it through. If the supplier holds a 197 lower/nil-deduction certificate, note its number on the same form.

Deposit and record challans

TDS you deduct in a month is due by the 7th of the next month (March deductions get until 30 April) via challan ITNS 281. The returns page prints a challan pre-fill sheet you can copy into the e-Pay Tax portal. After paying, add the deposit to the challan register with the bank's 7-digit BSR code and 5-digit challan serial, then use Link purchases to attach the deductions that challan covered. The hub's per-quarter cards then show deducted vs deposited — and warn about anything overdue or mismatched.

Quarter-end: 26Q, then Form 16A

On TDS → Returns, pick the financial year and quarter, clear the warnings panel, and download the 26Q workbook — a ZIP of three CSVs (challans, deductee annexure, summary). Hand it to your CA: they load the figures into Protean's free Return Preparation Utility (RPU), validate the output with the File Validation Utility (FVU), and file it. Finocket prepares working papers only — it never files on your behalf.

After the 26Q is processed, you owe each vendor a Form 16A certificate (due 15 days after the return's due date). Finocket generates working copies — one watermarked PDF per deductee with their deductions and linked challans — useful for your records and for chasing gaps. The legally valid Form 16A must always be downloaded from TRACES; the watermark exists so a working copy is never mistaken for the real certificate.

Due dates at a glance

Deposit: 7th of the month after deduction; 30 April for March deductions.
26Q: 31 July (Q1), 31 October (Q2), 31 January (Q3), 31 May (Q4).
Form 16A: 15 days after each 26Q due date.

Scope & caveats

Finocket covers Form 26Q (payments to residents, non-salary). Salary TDS (24Q), payments to non-residents (27Q) and TCS (27EQ) are out of scope — your CA files those separately. Rates change with Finance Acts, and thresholds per section apply before TDS is due at all — treat every number here as a working figure and verify with your CA before filing.

Frequently asked questions

I deducted TDS while paying a contractor — what do I do next?

Deposit it by the 7th of the next month using challan ITNS 281 against your TAN (Finocket prints a pre-fill sheet), record the challan's BSR code and serial in the challan register, and report the deduction in that quarter's 26Q return. Finocket's TDS hub tracks deducted vs deposited per quarter so nothing slips.

What's the difference between TAN and PAN here?

PAN identifies the taxpayer; TAN identifies a tax DEDUCTOR. TDS your clients withhold from you lands against your PAN (26AS). TDS you withhold from vendors is deposited and reported against your TAN. You need a TAN before you can deposit or file 26Q.

What happens if my vendor won't give me their PAN?

Section 206AA can force deduction at 20% instead of the section rate, and the 26Q reports the row as PANNOTAVBL. Finocket flags every PAN-less TDS entry so you can chase the PAN before quarter-end.

Does Finocket file my 26Q return?

No — it prepares a reconciliation-friendly workbook (challans, deductee annexure, summary). Your CA loads it into Protean's free RPU, validates with the FVU and files. Finocket never auto-files anything.

Are the Form 16A PDFs from Finocket valid certificates?

No — they're clearly watermarked working copies for your records and review. The legally valid Form 16A is generated on TRACES after your 26Q is processed; hand those to your vendors.

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