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Urgent query on tds

anony (MANAGER) (145 Points)

26 April 2012

DEAR SIRS,

WE HAD MADE A PAYMENT OF RS. 50,000/- TOWARDS PROFESSIONAL SERVICES ON 01.10.2011 BUT DID NOT DEDUCT THE TDS U/S. 194J ON IT. NOW WHAT TO DO:

(A) WHETHER TO DEDUCT TDS ON 31.03.2012 @ 10% & PAY IT ALONGWITH INTEREST ON DELAYED DEDUCTION OF TDS @ 1% P.M. (01.10.11 TO 31.03.12) & INTEREST ON DELAYED PAYMENT OF TDS @ 1.5% P.M. (01.04.12 TO TILL DATE)

(B) WHETHER TO DEDUCT TDS ON 01.10.2011 ITSELF & PAY INTERST ON DELAYED PAYMENT OF TDS @ 1.5 % P.M. (01.10.11 TO TILL DATE). & REVISE RETURN FILED FOR III QUARTER.

KINDLY PROVIDE YOUR EXPERT ADVICES, SO THAT I CAN DO THE NEEDFUL.

REGARDS,

LALIT DHABRIA

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20 Replies

CA Sripal Jain (Associate Finance) (709 Points)
Replied 26 April 2012

hi option 1 is better,it is always adivsable that you dont go for revised return inless there is some urgency or wrong error which is substantial,i suggest you to pay interest ,i dont think so one can deduct TDS backdated,just want some more inputs on your second suggesstion regards sripal jain

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O.D.SHARMA (DGM-F & A) (1734 Points)
Replied 26 April 2012

second option is only solution.You have to see payment date/cr date & the early one to be considerd for TDs purpose.

anony (MANAGER) (145 Points)
Replied 26 April 2012

ONCE AGAIN, I GOT CONFUSED.

SHARMA SB., YOU ARE RIGHT IN YOUR VIEW THAT WE NEED TO CONSIDER DATE OF PAYMENT FOR MAKING TDS DEDUCTION. & THAT IS WHY I HAVE BEEN COMPUTING INTEREST W.E.F 01.10.2011 IN BOTH OPTIONS.

NOW I JUST WANT TO KNOW THAT UPTO 31.03.2012 I WILL HAVE TO PAY INTEREST @ 1% P.M. OR @ 1.5% P.M.

( BEACUSE INTEREST FROM 31.03.12 TO TILL DATE WILL HAVE TO BE PAID @ 1.5% IN BOTH THESE CASES)

I.E. INTEREST ON DELAYED PAYMENT OR INTEREST ON DELAYED DEDUCTION.

I THINK SRIPAL JAIN IS RIGHT.

KINDLY REVERT BACK.

Bala Pullaiah B (Salaried) (179 Points)
Replied 26 April 2012

If you deduct and not paid 1.5%, In your case deduction itself was not done. Hence 1% is correct.

JITENDRA KUMAR (CMA- FINAL) (31 Points)
Replied 26 April 2012

please deposit the TDS amount in the bank with interest as soon as possible as 30th April is the last date for the 4th qtr.

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Prateek Agarwal (Sr. Executive - Finance & Accounts) (1732 Points)
Replied 26 April 2012

I think second option is correct. Because you have already paid at an earlier date, so interest would be calculated from that date itself.

vijay tanna (CA) (32 Points)
Replied 26 April 2012

Its better to deduct TDS on 31 March and pay till 30 April.

Reason:

Interst rate you have to pay only 1% for delay in ded of TDS and not 1.5% for TDS ded but not paid to gov.

Secondly you should not forget to recover that form that person..

CA Dinesh Kalra (Practising) (31 Points)
Replied 26 April 2012

In ur case option one is better. It is not adivsable to file revised return unless there is some urgency or wrong error which is material. Tax cannot be deducted in back date. So pls deduct the Tax now and pay the interest thereon showing the date of Cr and date of ded. seperately in the return

regards

Dinesh Kalra

O.D.SHARMA (DGM-F & A) (1734 Points)
Replied 26 April 2012

Hi,

Go with second option & 1.5 % interest for delay.

CA Sripal Jain (Associate Finance) (709 Points)
Replied 26 April 2012

i dont undersntd why one needs to go with second option ,as you havent deducted tax on 1.10,so how can u expect that you wil be waived late deduction of TDS.one cannot do backdated TDS entry if ur able to do it its fine,bt strictly speaking option 1 is legally correct and as per the provisions of income tax

regards

sripal jain

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Phalgun (Audit Manager) (327 Points)
Replied 26 April 2012

Option one is legally correct, other wise it amounts to over riding of law.

O.D.SHARMA (DGM-F & A) (1734 Points)
Replied 26 April 2012

Dear Lalit,

Legaly you have to go with second option.As this is due since payment & revise the return ,pay with interest .Pay & relax u will have sufficient justification .which legal optin gives first option ? Finally this will be your choice.

Aparna Raja K.C (Student) (520 Points)
Replied 26 April 2012

Isnt it advisable to pay interest @ 1% till 31.3.2012 and 1.5% for april 2012?

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(Guest)

Originally posted by : Lalit Dhabria
	ONCE AGAIN, I GOT CONFUSED. SHARMA SB., YOU ARE RIGHT IN YOUR VIEW THAT WE NEED TO CONSIDER DATE OF PAYMENT FOR MAKING TDS DEDUCTION. & THAT IS WHY I HAVE BEEN COMPUTING INTEREST W.E.F 01.10.2011 IN BOTH OPTIONS. NOW I JUST WANT TO KNOW THAT UPTO 31.03.2012 I WILL HAVE TO PAY INTEREST @ 1% P.M. OR @ 1.5% P.M. ( BEACUSE INTEREST FROM 31.03.12 TO TILL DATE WILL HAVE TO BE PAID @ 1.5% IN BOTH THESE CASES) I.E. INTEREST ON DELAYED PAYMENT OR INTEREST ON DELAYED DEDUCTION. I THINK SRIPAL JAIN IS RIGHT. KINDLY REVERT BACK.