Interest charged on late payment of tds

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 May 2013 Please let me know if I booked the provision bill for Mar' 13 on 31/03/13 & paid the Tds on 12/05/13, whatt should be the interest amount & how it will calculate???

Deepak Agrawal

Deepak Agrawal (Expert)
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10 May 2013 For march month due date of payment of tds is 30 April. thus you are liable to pay interest @1% on the TDS payable amount for full month of may irrespective of days.

Querist : Anonymous

Querist : Anonymous (Querist)

10 May 2013 Thanks,for reply..

but sir as per taxguru website the rate of interest showing as 1.5% pm,
If i faiure to pay the tds within the due date i.e. 30th April, how many days i will calculate interest from due date or from bill booking date?

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Deepak Agrawal

Deepak Agrawal (Expert)
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10 May 2013 Yes.. sorry..1% is for deduction and 1.5% for delay in payment.Interest is calculated for full month even for delay of 1 day.

Querist : Anonymous

Querist : Anonymous (Querist)

10 May 2013 Sir I'm not clear,
I booked the bill & deduct TDS on 31st Mar, but failed to pay the tds within 30th april.
If i will pay on next 13/05/13 , then how many month i have to pay the interest.
From a source I came to know if you could not pay the tds within due date, the interest should calculate from the booking date of bill, in taht case i have to pay interest foer 2 months, Please confirm.

Deepak Agrawal

Deepak Agrawal (Expert)
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10 May 2013 Interest will be charged for 1 month only as there is no delay in deduction. it will be charged for delay in payment @1.5% for 1 month (1/05/13 to 13/05/13 (full month).

Refer the following section of the Act:

the following provision should be read with the provision of due date of 30 April.

Section 201(1A):
[(1A) Without prejudice to the provisions of sub-section (1), if any such person, principal officer or company as is referred to in that sub-section does not deduct the whole or any part of the tax or after deducting fails to pay the tax as required by or under this Act, he or it shall be liable to pay simple interest,—
(i) at one per cent for every month or part of a month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted; and
(ii) at one and one-half per cent for every month or part of a month on the amount of such tax from the date on which such tax was deducted to the date on which such tax is actually paid,

Querist : Anonymous

Querist : Anonymous (Querist)

10 May 2013 in this case i have deducted tds on 31/03/13 & will deposit on 13/05/13, then i have to pay interest for Apr & May, am i correct?

Deepak Agrawal

Deepak Agrawal (Expert)
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10 May 2013 No dear. as per my opinion, it should charged only for one month. sub-clause (ii) should be read with due date as well, because due date of payment for the March Month is 30 April and interest will be charged for period beyond 30 April @1.5%.

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