I work as an employee in a private ltd company and had changed my job in Oct 2011. With the change I got some salary increase and some relocation benefits, which changed my slab.
Till Sept 2011, my total income (after including settlement of leave encashment and removing the deductible u/s 10, 80C) was 698355/-. They duly deducted TDS of Rs 62348/-.
My income from the new company post Sept 2011 for FY 2011-12 was 1019624/-. I couldn't furnish the income from previous employer to new company as I didn't got the final settlement letter till late Jan 2012. So, they without calculating the prev income they deducted TDS of Rs 123506/-.
In March 2012, I did my own calculation considering my complete salary and deductions of Rs 1,20,000 under section 80C/80CCF. And also deducted relevant HRA and medical bills that I had submitted to both the organizations for Rs 15000. As per my calculations, by total tax including cess.. sec cess etc came out to be Rs3,27,900/-
I paid an advance tax on 30.03.2012 the tax after subtracting the TDS deducted by both organization.
Now my question is since I was not aware of my total tax till Jan 2012. How could I calculated my advance tax and paid for the first two installments. Do I still need to pay the interest on advance tax for the first two installments? Isn't there any kind of amendment to section 234C which is applicable to case like mine.
21 July 2012
You are still require to pay interest U/s 234C as it is based on estimations. . Almost passing of 5.5 month or say nearly one half-year- installment being demanded by the Govt is 30% of the tax liability . It's not harsh looking to the fact that 45% of the time gets elapsed. Similar is the case with the Second Installment. . Further you are rightly allowed credit for the amount being paid and interest is charged on the shortfall in the installments. . What I mean to say, this is the least affecting interest. The Horror Show begins in case of late filing of returns when Section 234A and 234B applies together. . In your case, a hidden remedy was available to you and had it been known to you , you would have not been complaining. . In case you have requested to your employer on March 30th or 31st itself to deduct the differential tax amount of tax from your salary account (the amount, which you have paid through the challan of advance tax) from your Salary, the employer could have deposited the same without any extra interest burden to any of the parties. .
21 July 2012
Thank you sir for your reply. I understand the point.. thanks.. probably its a learning for me and something which I would let every new joinee in my organization know.. so atleast they don't face issue like mine.
01 July 2013
Yes I agree with the expert but for individual it is different and for companies it is different. Out of total tax payable you have to first deduct TDS then you have to calculate the interest.
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