Section 200 Income Tax Act: Duty of Person Deducting Tax

Section 200 of the Income-tax Act, 1961 sets out the duties of a person who deducts tax at source (TDS): deposit the tax with the Central Government, submit prescribed statements, and correct errors when required. From 1 April 2026, the corresponding compliance framework is principally contained in section 397(3) of the Income-tax Act, 2025, read with the applicable Income-tax Rules, 2026.

Meaning and scope of section 200

A deductor is a person legally required to withhold tax when making or crediting specified payments. TDS is the amount withheld from a payment and deposited with the Government on behalf of the recipient. A TDS statement reports deductor, deductee, payment, tax and deposit details to the tax authority.

Section 200 does not itself determine which payments attract TDS or their rates. Those questions arise under the relevant deduction provisions. It governs what happens after tax is deducted or, in the specified salary case, paid by the employer.

Section 200 explained subsection by subsection

Section 200(1): Payment of deducted tax

Every person deducting tax under the preceding provisions of Chapter XVII must pay the amount deducted to the credit of the Central Government, or as directed by the Central Board of Direct Taxes (CBDT), within the prescribed period. A deduction from the payee without timely remittance does not satisfy this obligation.

Section 200(2): Tax paid by an employer under section 192(1A)

An employer who elects to pay tax on specified non-monetary perquisites under section 192(1A) must deposit that tax within the prescribed time. This is distinct from withholding tax from the employee's cash salary.

Section 200(2A): Government offices and payment without challan

Where a Government office credits deducted tax, or tax paid under section 192(1A), without producing a challan, the responsible Pay and Accounts Officer, Treasury Officer, Cheque Drawing and Disbursing Officer or equivalent officer must furnish the prescribed statement, with prescribed particulars, verification and timing.

Section 200(3): Periodic TDS statements and corrections

After paying the tax, the deductor must prepare and submit the prescribed TDS statements for the relevant reporting period. A correction statement can rectify mistakes or add, delete or update reported information. The Finance (No. 2) Act, 2024 added a six-year limit, effective 1 April 2025, measured from the end of the financial year in which the original statement was required to be delivered.

TDS deposit deadlines

Under Rule 30 of the Income-tax Rules, 1962, the general deposit deadlines for non-Government deductors are:

The Income Tax Department states that Rule 218 of the Income-tax Rules, 2026 retains the general deposit timelines. Always check the relevant rule, transaction category and any applicable extension before filing.

Quarterly TDS statements under the 1961 Act

Rule 31A prescribes quarterly TDS statements. The usual statement types are Form 24Q for salary, Form 26Q for most non-salary resident payments, and Form 27Q for specified payments to non-residents. Some transactions use a separate challan-cum-statement instead of an ordinary quarterly return.

For tax years governed by the Income-tax Act, 2025, the return format and detailed requirements must be checked against the Income-tax Rules, 2026 and current portal instructions; do not assume that every old form number continues unchanged.

Income-tax Act, 2025: Section 397(3)

The successor law combines deduction and collection compliance in section 397. In particular:

• Section 397(3)(a): deposit tax deducted or collected, or specified employer-paid tax, within the prescribed time.
• Section 397(3)(b): deliver the prescribed periodic statement after paying tax.
• Section 397(3)(e): furnish specified reporting for Government offices where tax is credited without a challan.
• Section 397(3)(f): permit correction of specified statements within two years from the end of the tax year in which the statement is required to be delivered, including statements under section 200 of the 1961 Act, subject to the applicable statutory text.

The new correction period is materially different from the six-year period introduced into section 200(3) of the 1961 Act. Apply the governing statute and transitional rules to the particular statement; do not treat the two periods as interchangeable.

Practical example

A company deducts TDS from a consultant's invoice in November 2025. Ordinarily, the deducted tax must be deposited by 7 December 2025, and the relevant non-salary TDS statement for the quarter ending 31 December is ordinarily due by 31 January 2026. If a deductee's PAN is entered incorrectly, the deductor should use the applicable correction-statement mechanism within the legally permitted period. This example assumes no special transaction rule or extension.

Consequences of non-compliance

Late payment or failure to deposit TDS can attract interest and other consequences under the applicable law, including section 201 of the 1961 Act. Delayed TDS statements may attract fees under section 234E and, where conditions are met, penalties under section 271H. A person should also verify the current successor provisions for defaults arising under the 2025 Act. Filing a statement does not itself cure failure to deposit the underlying tax.

Deductor compliance checklist

1. Identify the correct TDS provision, rate, threshold and payment or credit trigger.
2. Verify PAN, TAN (where required), deductee details and applicable certificates.
3. Deduct and deposit tax by the correct due date.
4. Reconcile challans, deductions and deductee information.
5. Submit the applicable quarterly statement or challan-cum-statement.
6. Issue the required TDS certificate and correct discrepancies within the statutory period.

Official legislation and guidance

• Income Tax Department: Section 200, Income-tax Act, 1961
• Income-tax Act, 2025: Section 397(3) (official Act PDF)
• Income Tax Department: Tax payment FAQs and 2026 transition
• Income Tax Department: TDS compliance and transitional guidance
• Income Tax Department: Tax deductor guide and quarterly statement dates

Updated 27 October 2026. This is general legal and tax information, not advice for a particular transaction. Verify the applicable tax year, statutory amendments and notified filing extensions.