Interest on capital gains tax

Tax queries 533 views 2 replies

Hi,

Is one liable to pay interest on late payment of capital gains tax even if the payment is made within 5 days of gains accrual?

The case context goes like this.. so I sold shares converted out of ESOPS of my pvt firm to a firm that acquired it. I received the payment on some March 25th and I paid the full capital gains tax due in 4-5 days. While filing the ITR I mentioned it as advanced tax paid. I reckon the last day for payment of adv tax in a year is March 15. But what is the way in case the gains itself acrues after that date? I mean I didn't even have the cash to pay the tax amount before I received the money that I did get eventually. I am totally intrigued how can this be. I mean the interest penalty.

The ITR letter that i have received says total interest liability of Rs 2612 under Sec 234C.

The capital gains was Rs 15.45 lakh and being under the top income bracket I paid Rs 4.77 lakh as advance tax.

The in-house CA gave contrasting views. Initially he had told me if I submit the tax within first week of April 2015 there won't be any tax liability. But now he is saying maybe there is a liability as it was deposited after March 15 and advanced tax has to be paid as an anticipated tax.

 

 

 

 

Replies (2)
You could have been spared from payment of interest on no/ short payment of advance tax in case of capital gains if you deposit the entire tax in the remaining instalments of advance tax or if gain arises after 15th march then till 31st march. Here if you have deposited tax after 31st march then the benefit of first proviso to section 234C(1) is not available to you and you would be liable to pay interest.

Thanks. But as I mentioned I paid the tax before 31st March. Cap Gains accrued by March 25 (give or take a day) and tax deposited by March 29-30.

 

 


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