Recently i received one notice from I-T department regarding TDS short deduction for the F.Y-2008-09. They asked to pay for Short deduction in Sec.194 C payment. As per my TDS Calculation & Return, for Sec.194C, i had taken the rate of 2.266%. But I-T department taken the rate at 2.27% i.e. they rounded up the percentage of rate. So the short deduction arised. is it correct? Should i round up the TDS rate because i knew the tax amount to be round up to next 1 rupee not rate of tax. Kindly explain and advise me whether i have to pay difference tds or not.
15 November 2010
Ideally one should calculate tax to 2 decimal points only. Contact your AO and request him to delete the demand on this explanation basis that the demand is only for this reason.
CAclubindia
