The Central Board of Direct Taxes have extended the due date for filing of quarterly statements of Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) for the quarter ending 30th September 2007 of financial year 2007-08 to 29^th February 2008. This is in view of the difficulties being faced by the tax deductors / collectors in filing statements with the correct PAN data mandatorily required to be furnished to the extent of at least 90% in the cases of salaried deductees and 70% in the cases of other deductees.

It may be recalled that as the requirement of filing TDS / TCS certificates had been done away with, the lack of PAN of deductees was creating difficulties in giving credit for the tax deducted and collected. It was, therefore, decided that TDS returns for salaries, i.e. Form No.24Q with less than 90% of PAN data, and TDS returns for payments other than salaries and TCS returns, i.e. Form No.26Q and Form No.27EQ respectively, with less than 70% of PAN data would not be accepted for the quarter ending on 30.9.2007 and thereafter. Tax deductors and tax collectors were, therefore, advised to obtain correct PAN details of all deductees and quote the same in the TDS / TCS returns, failing which the TDS / TCS returns would not be accepted and all penal consequences under the Income Tax Act would follow. Taxpayers liable to TDS / TCS were also advised to furnish their correct PAN with their deductors, failing which they would also face penal proceedings under the Income Tax Act.

It may also be recalled that for and from the quarter ending 30.9.2007, in addition to government offices and companies, filing of TDS / TCS returns in electronic form has been made mandatory for (i) deductors / collectors required to get their accounts audited under section 44AB of the Income-tax Act in the immediately preceding financial year, and (ii) where the number of deductees' / collectees' records in a quarterly statement for any quarter of the immediately preceding financial year is equal to more than fifty.

TDS/TCS filing requirements extended to allow mandated PAN data compliance before returns are accepted and penal consequences apply. Extension postpones the deadline for filing quarterly TDS and TCS statements to allow deductors/collectors to furnish mandated PAN data: 90% coverage for salaried deductees and 70% for others. Returns with PAN coverage below these thresholds will not be accepted and penal consequences under the Income-tax Act may follow. Deductors must obtain and quote correct PANs and deductees must furnish correct PANs to avoid penalties. Mandatory electronic filing applies for entities covered by audit requirements and those with large numbers of records in prior-year quarters.