More than 30,000 TCS Employees received Tax Demand Notices over TDS Errors

TCS employees have received tax demand notices! The Income Tax Department has issued demand notices to a large number of TCS employees, ranging from 30,000 to 40,000, due to irregularities in their tax deducted at source (TDS) claims.

The tax demand ranges from Rs .50,000 to more than Rs.1 lakh, depending on the employee’s seniority in the organization.

According to the report, the issue appears to be a consequence of a software glitch that prevented TDS claims from being updated on the portal of income tax.

The notices were issued on September 9 under Section 143(1) of the Income Tax Act which said that there was no record of the entire amount paid by the assessee for the quarter of March of FY24.

CA Himank Singla wrote on Twitter, “Many Tata Consultancy Services employees are receiving tax demands from the IT department for the financial year 2024-25. According to 143(1) notices given by the department, the TDS claimed by the assessee has not been properly updated by the department, hence refunds are being withheld.”

TCS refuses to comment on the issue when reached by journalists via email. However, the company has contacted its employees, instructing them to await additional instructions before making any of the payments indicated in the notice.

TCS has also notified the tax authorities and is working with them to rectify the issue as soon as possible. In an internal communication, TCS notified its employees that they had obtained clarity from the tax authorities.

The email continues, “We understand that the tax authorities will be reviewing the returns, post which TDS shall be in alignment with Form 26AS issued by the income tax department and Form 16 Part A issued by TCS.”

The company is actively working to resolve the issue and correct the inaccuracies.