Penalty for Late Filing of TDS Returns

By | May 13, 2026
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Penalty for Late Filing of TDS Returns

Late filing of TDS (Tax Deducted at Source) returns in India attracts a mandatory fee of ₹200 per day under Section 234E of the Income Tax Act, 1961. This fee accumulates for every day the return is delayed, starting from the day after the due date, until the total fee equals the amount of TDS deductible for that period.
Key Aspects of TDS Late Filing Fees (Section 234E):
  • Amount: ₹200 per day (not a penalty, but a fee).
  • Maximum Limit: The total late fee cannot exceed the total amount of TDS deducted.
  • Payment Condition: The late fee must be deposited before filing the TDS return.
  • Requirement: It applies to all types of TDS returns, such as Form 24Q, 26Q, and 27Q.
  • Additional Penalties (Section 271H): In addition to the late fee, the Assessing Officer may impose a penalty between ₹10,000 and ₹1,00,000 for failing to file the return on time or filing incorrect information.
  • No Penalty Exemption: The Section 271H penalty can be waived if the TDS/TCS is paid to the government, late filing fees under 234E are paid, and the return is filed within one year of the original due date.
TDS Interest Rates for Delayed Payment:
  • Failure to Deduct: Interest of 1% per month or part of the month on the tax amount, from the date it was deductible to the actual date of deduction.
  • Failure to Pay after Deduction: Interest of 1.5% per month or part of the month, from the date of deduction to the actual date of payment.

How to pay late fees for tds return

To pay the late filing fees for a TDS return, you must deposit the calculated amount online through the Income Tax Department’s e-filing portal before submitting your regular or correction return.

Step 1: Make the Payment Online

  1. Go to the Income Tax Department e-filing portal.
  2. Navigate to the “e-Pay Tax” section.
  3. Enter your TAN (Tax Deduction and Collection Account Number) and mobile number to complete the OTP verification.
  4. Select the TDS payment category.
  5. Under the applicable assessment year, proceed with Challan ITNS 281.
  6. Set the type of payment (Minor Head) based on your situation:
    • Select (200) TDS/TCS Payable by Taxpayer if you are filing a self-assessment/regular return late.
    • Select (400) TDS/TCS Regular Assessment if you are responding to an official demand notice from the department.
  7. In the tax breakup screen, enter the computed late fee amount strictly under the “Fee under Section 234E” column. Leave the tax and interest columns blank if you are only paying the late fee.
  8. Select your payment method (Net Banking, Debit Card, RTGS/NEFT, or Payment Gateway) and complete the transaction.
  9. Download the challan receipt. Note down the BSR Code, Challan Serial Number, Tender Date, and Amount.

Step 2: Update Your Return or Respond to TRACES

To close the default, you must match the paid challan with your TDS filing:
  • If you haven’t filed the return yet: Map this newly generated challan directly inside your TDS return preparation utility (RPU). Ensure the fee amount is placed in the “Fee” column of the challan details before validating and generating the FVU file.
  • If you received a demand notice for an already filed return:
    1. Log in to the TRACES portal.
    2. Go to Defaults > Request for Correction.
    3. Choose Online Correction mode.
    4. Select the option “Late filing Levy”.
    5. Add the new challan details, tag/consume the exact fee amount in the “Fee” column, and submit the online correction statement.

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