Any business that deducts TDS on payments to vendors (Section 194C, 194J, 194I, 194H, etc.) must file Form 26Q quarterly. The due dates are: July 31 (Q1: April to June), October 31 (Q2: July to September), January 31 (Q3: October to December), and May 31 (Q4: January to March). Each return contains details of every TDS transaction: the deductor’s TAN, each vendor’s PAN, the payment amount, the TDS deducted, and the TDS section.
Zoho Books maintains all TDS deduction records from approved bills. The TDS Detail report shows every transaction where TDS was deducted: vendor name, PAN (if stored in the vendor record), payment amount, TDS section, TDS rate, and TDS amount deducted. This data is the input for your CA or TDS consultant to prepare Form 26Q. If vendor PAN numbers are missing in Zoho Books, TDS will have been deducted at the higher rate (20% for PAN-not-available scenarios) and the Form 26Q will show the higher deduction.
For every vendor from whom you deduct TDS, store their PAN in the vendor contact record in Zoho Books. Without the correct PAN, Zoho Books may not correctly identify the vendor in the TDS report, and the TDS deducted at the higher rate creates problems for the vendor when they file their income tax return (the Form 26AS credit will show a high TDS at 20% which they must claim back). Ensure PAN data is collected and entered for all TDS-applicable vendors before the first bill is processed.
Form 26Q is the quarterly TDS return for non-salary payments. Zoho Books generates the TDS data (by section, vendor PAN, and quarter) required for Form 26Q preparation and filing by your CA.
Go to Reports, then TDS Reports, select TDS Summary or TDS Detail, filter by quarter and sections, and export. Your CA uses this data to file Form 26Q on TRACES.
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