Dear Team,
We filled TDS return Q-1 25-26 recently of our firm.
PAN and aadhar has been already linked of all dedutees.But TDS return processed with default i.e 2 PAN out of all PANs is Non-operative and demand 20% TDS instead of 1%.But PAN and Aadhar has been already linked as we have checked on income tax portal at Aadhar link status.
What is the solution
Firm faces 20% TDS rate due to PANs wrongly flagged inoperative despite PAN-Aadhaar linking under Income Tax rules A firm filed its TDS return for the first quarter of the financial year 2025-26, having already linked the PAN and Aadhaar of all deductees. However, the return was processed treating two PANs as inoperative, resulting in a default TDS deduction rate of 20% instead of the applicable 1%. Despite verification on the income tax portal confirming the PANs were linked with Aadhaar, the issue persisted. The firm seeks guidance on resolving this discrepancy where linked PANs are incorrectly flagged as inoperative, causing higher TDS demand. (AI Summary)
TaxTMI 
TaxTMI 
