Tds payment debited to account on 01st may

I think you will have to go ahead with option B

Dear Lalit, 30th April is the due date for the payment of TDS that is deducted in the month of March. So, if the payment of credit whichever is earlier is of the month of March, then you need to pay interest @ 1.5 % p.m. i.e. for 1 month only. However, if the date of deduction is any date earlier than 1st March, the for every month of delay, you need to pay interest.

I have answered on the basis of facts you have mentioned. If there is any other thing, please elaborate in detail.

- CA. Amol Gopal Kabra

SIR,

I HAVE ONE DOUBT IN IT, PLZ CONFIRM.

INTEREST ON DELAYED PAYMENT OF TDS IS COMPUTED FROM THE DATE OF DEDUCTION OF TDS.

PLZ CONFIRM.

BUT AS PER SECTION 201 (1A), WE NEED TO COMPUTE INTEREST FROM THE DATE OF DEDUCTION TILL ACTUAL DATE OF PAYMENT. KINDLY CONFIRM.

As far as the Section is concerned, your interpretation is right. But in my opinion, the interest starts after the due date. Even, there were cases of my clients where there was delay in payment of tax, but then the software has calculated interest after the due date only and there was no further notice from the department for short payment of interest. Even the quarterly returns got validated properly.

BUT AS PER SECTION 201 (1A), WE NEED TO COMPUTE INTEREST FROM THE DATE OF DEDUCTION TILL ACTUAL DATE OF PAYMENT. KINDLY CONFIRM.

i saw many notices u/s 220(2) of IT act on which interest was calculated from the date of deduction to the actualy date of payment

I have not yet faced a single notice for the default of my clients.

Abstract from Sec 201

Sub Sec 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,

and such interest shall be paid before furnishing the statement in accordance with the provisions of sub-section (3) of section 200"