Introduction

Form 27D  is a certificate for Tax Collected at Source (TCS) u/s 206 of Income Tax Act, 1961. It is the certificate for the return filed in Form 27EQ.

The filing of Form 27D requires details of both PAN (Permanent Account Number) and TAN (Tax Deduction and Collection Account Number). Form 27D is filed by a seller of goods, not by the purchaser.

Each seller has to collect tax on different goods from the buyer. Tax collected depends on the nature of the goods, not on the mode of payment.

Tax is not payable on the goods mentioned below when these goods are utilized for the purpose of manufacturing, processing, or producing things. If these goods are utilized for the trading purpose then tax is payable.

  • Alcoholic liquor for human consumption;
  • Tendu leaves;
  • Timber obtained from forest under lease or from any other forest which is not on lease;
  • scrap.

Eligibility

Seller

A party that makes offers or contracts to make a sale to an actual or potential buyer. It does include:

(a) The Central and State Governments

(b) Local Authority

(c) Statutory Corporation or Authority

(d) Company

(e) Firm

(f) Co-operative Society

(g) Individual or Hindu Undivided Family (HUF) if covered under Section 44AB (mandatory audit)

Buyer

A person who buys in any sale, auction,  any other mode, that includes specified goods/items is called a buyer. It does not include:

(a) Public Sector Company

(b) Central/State Government

(c) Embassy, High Commission, Legation, Consulate, and Trade representation of a foreign state

(d) A club

(e) A buyer in the retail sale of such goods purchased for personal consumption.

Scrap

Waste from manufacturers or mechanical material that is not in use because of breakage, cutting-up, wear and other reasons.

Exemption

TCS is exempted in following:

  • If goods are bought for personal consumption.
  • The buyer who buys specified goods for manufacturing, processing or production and not for the purpose of trading any tax would be collected. In such case, the buyer submits a declaration in Form 27C to Seller.

Deposits & Certificates

  • The Seller deposits the TCS amount in Challan 281 within 7 days from the last day of the month in which tax is collected.
  • Form 27D is issued to Buyer (a TCS Certificate).
  • It should contain the name of the Seller & Buyer, TAN, and PAN, total tax collected by the seller, date of collection, the rate of tax applied to it & other such particulars as may be prescribed.

Due Date 

The Seller who has collected and deposited the TCS Amount, Quarterly Return has to be filed in Form 27EQ in Electronic Format in the NSDL format. After filing the return for TCS, a certificate Form 27D is issued after 15days.

form 27D

In case you are confused about TDS Return Filing as a deductor, feel free to consult the experts at LegalRaasta. You can get comprehensive assistance with our TDS Return Filing Software which supports TDS on Salary payments (Form 24Q), Rent, Interest, Commission and other Non-salary transactions (Form 26Q), NRI (Form 27Q)and TCS (Form 27EQ).