Section 200A of ITA, 1961 : Section 200A: Processing Of Statements Of Tax Deducted At Source

Explanation using Example

Imagine a small business owner, Mr. Sharma, who has hired a few freelancers to work on a project. As per the Income-tax Act, Mr. Sharma is required to deduct tax at source (TDS) before making payments to the freelancers. After deducting the appropriate TDS, he files a quarterly statement of tax deduction at source (TDS return) to the Income Tax Department, as mandated by section 200 of the Income-tax Act, 1961.

Upon filing the TDS return, the Income Tax Department processes the statement as per Section 200A. During this processing, they notice that Mr. Sharma made a mathematical error while calculating the TDS amount. The department corrects this arithmetical error and recalculates the TDS liability. T...

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