Interest calculation for e-filling after due date

Dear Soumyaranjan,

Let me explain Interest u/s 234A, B and C with the help of an example.

Suppose an individual has earned a total Income of Rs 15 Lakh in A.Y. 2016-17 on which Rs 1,83,250/- was deducted as TDS . So he has to pay:
Tax - Rs 2,75,000/-
Education Cess - Rs 8,250/-
Total - Rs 2,83,250/-
Less: TDS - (Rs 1,83,250/-)
Tax Payable - Rs 1,00,000/-.
He has filed his return on 31st March 2017. Return filing due date was 31st July 2016.

Now, Interest u/s 234A is calculated for delay in filing of return. It is calculated @ 1% from the day following the return filing due date to return filing date on the tax payable net of TDS. So here Interest u/s 234A is calculated @ 1% on Rs 1,00,000/- from 01.08.2016 to 31.03.2017 i.e. 8 months which comes to Rs 8,000/-.

Interest u/s 234B is calculated when advance tax paid is less than 90% of tax payable (net of TDS). It is calculated from the 1st day of next financial year to the date the amount is paid. In the present case, Interest u/s 234B is calculated on Rs 1,00,000/- from 01/04/2016 to 31/03/2017 i.e. 12 months which comes to Rs 12,000/-.

Interest u/s 234C is calculated when advance tax has not been paid within the prescribed time. Here, assessee should have paid:
Rs 30,000/- (30%) by 15th September, Rs 60,000 (60%) by 15th December and Rs 1,00,000/- by 15th March which was not paid. So interest u/s 234C is @ 1%:
for 3 month * 30,000 = 900
for 3 month * 60,000 = 1,800
for 1 month * 1,00,000 = Rs 1,000
Total = Rs 3,700/-

Therefore tax payable = 1,00,000 + 8,000 + 12,000 + 3,700 = Rs 1,23,700/-

Note: Part of the month shall be considered as full month in calculation of Interest.

Thanks Manish!

Dear Manish,

 

Please tell me, if total deductd TDS is 94% of total tax liability.

Is 234 B & 234 C apply or not.

234B wont apply as tax paid is greater than 90% of tax liability. However, 234C will apply on the balance amount of tax payable