Please Wait ..

Sign-in to your account


Username:
Password:

Remember Me

Forgot your password?

Sign-up now



Join CAclubindia.com and Share your Knowledge. Registered members get a chance to interact at Forum, Ask Query, Comment etc.


Discussion > Income Tax > Tax queries >

Interest calculation under section 234 a/b/c

    Post New Topic
Pages : 1 2





Very Good

[ Scorecard : 47]
Posted On 22 August 2011 at 08:33 Report Abuse

1) Please calculate Interest under section 234A, 234B (not sure if applicable here), 234C (not sure if applicable here):
A.Y.2011-12, Date of Filing 22-Aug-2011, Due Date:31-jul-2011,
Net Taxable Income : 524310
Tax on above : 38862
Edu cess: 1166
Total Tax & Cess: 40028
TDS Paid:
B4 15 sep 10: 12179
B4 15 Dec 10: 3385
B4 15 Mar 11: 16538
Total TDS: 32102

Also it will be great if you can clear my following doubts:

2) will the interest be calculated on pro rata basis i.e only for 22 days for the month of august or will it be calculated for the entire month (all 31 days) ?

3) In my case above entire income is salary income, and usually I pay tax via TDS deduction by my employer. This finacial year I changed my job and new employer didn't considered my 3 month income from previous employer and hence the tax due. Given that sections 234 B & 234 C come into play only when advance taxes are involved, will they be applicable to me here? I got the following examples from net to support this - In case of Sumit Bhattacharya v. Asstt. CIT (2008) 113 TTJ (Mumbai), Mumbai Tribunal has held that where an employer is bound to deduct tax at source, the employee would not be held liable for the interest liveable under Section 234B and 234C. This order was followed by ITAT Madras , in case of ACIT vs Jagdish Gagual Rangwani ITA No. 2214/Mds/2005, Assessment year 2004-05.

 

Thank You
 


Online classes for CA CS CMA



Ninad Pandit
CA Final Student

[ Scorecard : 254]
Posted On 22 August 2011 at 10:26

Dear Sir,

                  If you have filed ur return on 22.07.2011, then no interest u/s.234A will be levied as sec.234A is interest for filing of return after due date. interest u/s.234B & 234C is levied when tax liabilty is more than 10,000 after taking into account the TDS deducted. In your case, ur tax liab is 7,926(40,028 - 32,102), so interest u/s 234B & 234C will not be attracted. I hope ur query is solved.





oyethatsme
Very Good

[ Scorecard : 47]
Posted On 22 August 2011 at 10:39

Originally posted by : Ninad Pandit

Dear Sir,

                  If you have filed ur return on 22.07.2011, then no interest u/s.234A will be levied as sec.234A is interest for filing of return after due date. interest u/s.234B & 234C is levied when tax liabilty is more than 10,000 after taking into account the TDS deducted. In your case, ur tax liab is 7,926(40,028 - 32,102), so interest u/s 234B & 234C will not be attracted. I hope ur query is solved.

Hi Ninad, Thanks for the reply.
I mistyped, actually I meant 22.08.2011. I have corrected my question.
Would really appreciate if you can reply with now changed scenario.

Thanks
 




vaibhav
CA

[ Scorecard : 49]
Posted On 22 August 2011 at 10:51

Calulation of Interest 234C (Tax libility- TDS ) =7926

1 upto 15sep 30% of 7926

2 upto 15Dec 60% of 7926

3 upto 15march 100% of 7926

which has been paid by the assessee so no in u/s 234C

 

Calculation of Int U/s 234B Tax Liability - TDS - Advance tax ) = -24176  so refund is no tax liability

Calculation of int U/s 234A :- Since Refund is Due.

Hope ur Ans is recevied




oyethatsme
Very Good

[ Scorecard : 47]
Posted On 22 August 2011 at 11:11

Originally posted by : vaibhav

Calulation of Interest 234C (Tax libility- TDS ) =7926

1 upto 15sep 30% of 7926

2 upto 15Dec 60% of 7926

3 upto 15march 100% of 7926

which has been paid by the assessee so no in u/s 234C

 

Calculation of Int U/s 234B Tax Liability - TDS - Advance tax ) = -24176  so refund is no tax liability

Calculation of int U/s 234A :- Since Refund is Due.

Hope ur Ans is recevied

Are you sure it's refund??

my question was regarding interest on tax due...




Ninad Pandit
CA Final Student

[ Scorecard : 254]
Posted On 22 August 2011 at 11:33

Dear Vaibhav & oyethatsme,

                            TDS Paid:

B4 15 sep 10: 12179
B4 15 Dec 10: 3385
B4 15 Mar 11: 16538

this is the details of the tds deducted & not advance tax, so total tax paid is same as tds i.e.32,102 & not 64,204.

INTEREST CALCULATION

Interest u/s 234A  Rs.  79

Interest u/s 234B  Rs. 396

Interest u/s 234C  Rs. 292

Total Interest payable = Rs. 767

Total Tax payable = 7926+767 = Rs. 8693

I hope your ans is received.




oyethatsme
Very Good

[ Scorecard : 47]
Posted On 22 August 2011 at 11:44

Originally posted by : Ninad Pandit

Dear Vaibhav & oyethatsme,

                            TDS Paid:

B4 15 sep 10: 12179
B4 15 Dec 10: 3385
B4 15 Mar 11: 16538

this is the details of the tds deducted & not advance tax, so total tax paid is same as tds i.e.32,102 & not 64,204.

INTEREST CALCULATION

Interest u/s 234A  79

Interest u/s 234B 396

Interest u/s 234C 292

Total Interest payable =767

Total Tax payable = 7926+767 =8693

I hope your ans is received.

Hi Ninad,

I am clear on 234A calculation,

however, as you earlier metioned "interest u/s.234B & 234C is levied when tax liabilty is more than 10,000 after taking into account the TDS deducted. In your case, ur tax liab is 7,926(40,028 - 32,102), so interest u/s 234B & 234C will not be attracted." then why shall I pay interest u/s 234B & 234C? Also If you in my original question I have sited some court rulings with respect to this. Please advise.

Thanks




Ninad Pandit
CA Final Student

[ Scorecard : 254]
Posted On 22 August 2011 at 11:54

I WILL HAVE TO CHECK ON THAT WHETHER U R LIABLE TO PAY INT. OR NOT. CAN I REPLY BY TOMO? AS TODAY I AM HAVING HOLIDAY SO MY OFFICE IS CLOSED.



Total thanks : 1 times



oyethatsme
Very Good

[ Scorecard : 47]
Posted On 22 August 2011 at 12:10

Originally posted by : Ninad Pandit

I WILL HAVE TO CHECK ON THAT WHETHER U R LIABLE TO PAY INT. OR NOT. CAN I REPLY BY TOMO? AS TODAY I AM HAVING HOLIDAY SO MY OFFICE IS CLOSED.

Sure. No Problem :)

Thanks




B. Umapathy
student

[ Scorecard : 400]
Posted On 22 August 2011 at 12:19

only 234 A is applicable

interest u/s 234 A Rs.79/-

234 B & C is Rs.0/-(I think so)

However, waiting for other CCI tes reply for correction (if any)



There are 14 Replies to this message








Related Files








Related Threads


Post your reply for Interest calculation under section 234 a/b/c



Your are not logged in . Please login to post replies

Click here to login


Not a member yet ?? Click here to signup

Message







    

  • Use thank button to convey your appreciation.
  • Maintain professionalism while posting and replying to topics.
  • Try to add value with your each post.



Forum Home | Forum Portal | Member Control Center | Who is Where | Popular Threads | Today's Topic | Recent Posts | Today's Posts | Post New Topic | Thread With Files | Top Threads This Month | Forum Stats | Unreplied Threads

back to the top