07 March 2012
Dear Expert, We had received Income Tax Demand Notice for AY2007-08 in that they Charged Interest for late return file U/S 234 A,B,C and D so i want to know how they calculate interest and what is % for Interest U/S 234A,234B, 234C and 234D.
Due Date of Return File 31.07.2007 Date of Return File 20.09.2007
08 March 2012
Mr. Dinesh, interest for late filing will be charged u/s. 234A at 1% simple interest for each month of delay after due date, non payment of advance tax or shortage in advance tax will attract interest u/s.234B, and u/s.234C, interest for shortfall in advance tax will be calculated for every quarter. Calculation of interest will be on the tax amount rounded off to nearest 100, in simple way take off the last 2 digits of the tax amount and put two zero. For 234B, interest calculation will start from the start of the assessment year till the month of filing and 234C interest will be for 3 months for each instalment, 1st instalment shortfall being less than 30% of the tax amount, 2nd being less than 60% and the 3rd being less than 100%
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