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Interest on late deposit of tds for 194j payment

Sandeep (Self Employed) (125 Points)

04 January 2012

I am not clear on what interest is to be paid on delayed deposit of TDS u/s 194J.

TDS deducted u/s 194J on the 4th October 2011 but will be deposited only on the 5th/6th Jan 2012. Is interest on delayed deposit to be paid from 4th October 2011 till date of deposit including fracftional months (4 months) or is to be paid from the due date of deposit 7th Nov 2011 till date of deposit including fractional months (3 months)?

Wording of the act seems to imply it has to be paid from date of dedcution i.e. 4th Oct 2011.

Request for clarification.

Regards

Sandeep

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12 Replies

CA Neil Ganatra (Partner - Gautam Joshi & Co.) (871 Points)
Replied 04 January 2012

it has to paid from 4th oct

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Jinay (Article) (172 Points)
Replied 05 January 2012

Agree with CA Niel Ganatra

CA Kiran Sutrave (CA) (428 Points)
Replied 05 January 2012

If TDS was deducted on Oct 04, then Interest @ 1.5% will be calculated from Oct 04 till the date of actual payment.

1 Like

CA RK RATHI (CA) (29 Points)
Replied 05 January 2012

agree with ca Kiran Sutrave.

Neha Jain (Article) (40 Points)
Replied 05 January 2012

But Tds is to be paid in the month following the month in which it was deducted.So TDS

has to b paid in November.So, 1.5%has to be paid from nov. to Jan

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Vineet Goyal (Assistant Manager - Finance & Accounts) (702 Points)
Replied 05 January 2012

But the interest is paid from the date on which TDS is deducted.

(Guest)

Interest is to be calculated from the date on which the tax is actually deducted to the date on which tax is actually paid.

CA Kiran Sutrave (CA) (428 Points)
Replied 06 January 2012

Dear Neha

There are two Interest rates that are applicable on delayed payment of TDS depending on situation: -

1. If TDS is not deducted at all then Interest @ 1% is to be deducted from the date of credit or payment whichever is earlier till the date of actual deduction; and

2. If TDS was deducted but not deposited then Interest @ 1.5% is to be paid from the date of actual TDS deducted which may be in form of date of credit or payment.

Naveen C. Bisht (Tax Consultant) (71 Points)
Replied 31 January 2012

u have to pay TDS FOR 4 months. u have deduct TDS on 04/10/2011, the due date is 07/11/2011, if u deposit the same beofe the due date than no interest is applicable, but u have deposite it on 06/01/2012, so the delay is start from 04/10/2001 to till date

exmplse

04 Oct to 03/11 - 1 month

04/11 to 03/12 - 1 month

04/12 to 03/01 - 1 month

04/01 to 06/01 - 1 month