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Tds - late deduction or non payment

Prashant Maheshwari (CA Final ) (46 Points)

01 October 2016

01.05.2015 : Mr. X received some services from Mr. Y [Value Rs. 100,000] on which TDS u/s 194J applicable. Payment made to Mr. Y on 20.12.2015 Mr. X booked this bill in his books of account on 15.05.2015 without deducting TDS Mr. X deducted TDS on 15.12.2015 and deposit the same on 06.01.2016 My Question is that - What is Mr. X default Late deduction of TDS Late Payment of TDS Mr. X fill his TDS Return on 15.01.2016 Please tell me total amount of interest or penalty if applicable ..

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6 Replies

Shubham Gupta (Business Consultants) (2077 Points)
Replied 01 October 2016

total interest to pay is Rs 900, 1% per month for part/month

CA Harshal Totla (Chartered Accountant) (2229 Points)
Replied 01 October 2016

As per section 201(1A) you are liable to pay interest as follows:
i.)at 1% for every month or part of the 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 percent 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.
In your case, tds should be deducted on the date of payment or date of credit in books whichever is earlier i.e. 15.5.2015 and you have deducted it on 15.12.2015. Hence, interest @ 1% per month (simple interest) shall be paid for 9 months.(₹900)
Interest on late deposit shall not be levied as the same is deposited within the time limits prescribed under the act.

CA Rahul Mor (Chartered Accountant) (173 Points)
Replied 01 October 2016

As per section 201(1A) you are liable to pay interest as follows: i.)at 1% for every month or part of the 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 percent 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. In your case, tds should be deducted on the date of payment or date of credit in books whichever is earlier i.e. 15.5.2015 and you have deducted it on 15.12.2015. Hence, interest @ 1% per month (simple interest) shall be paid for 9 months.(₹900) Interest on late deposit shall not be levied as the same is deposited within the time limits prescribed under the act.

Read more at: /forum/tds-late-deduction-or-non-payment-372998.asp

CA Rahul Mor (Chartered Accountant) (173 Points)
Replied 01 October 2016

As per section 201(1A) you are liable to pay interest as follows: i.)at 1% for every month or part of the 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 percent 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. In your case, tds should be deducted on the date of payment or date of credit in books whichever is earlier i.e. 15.5.2015 and you have deducted it on 15.12.2015. Hence, interest @ 1% per month (simple interest) shall be paid for 9 months.(₹900) Interest on late deposit shall not be levied as the same is deposited within the time limits prescribed under the act.

Read more at: /forum/tds-late-deduction-or-non-payment-372998.asp

CA Rahul Mor (Chartered Accountant) (173 Points)
Replied 01 October 2016

As per section 201(1A) you are liable to pay interest as follows: i.)at 1% for every month or part of the 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 percent 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. In your case, tds should be deducted on the date of payment or date of credit in books whichever is earlier i.e. 15.5.2015 and you have deducted it on 15.12.2015. Hence, interest @ 1% per month (simple interest) shall be paid for 9 months.(₹900) Interest on late deposit shall not be levied as the same is deposited within the time limits prescribed under the act.

Read more at: /forum/tds-late-deduction-or-non-payment-372998.asp

CA Rahul Mor (Chartered Accountant) (173 Points)
Replied 01 October 2016

As per section 201(1A) you are liable to pay interest as follows: i.)at 1% for every month or part of the 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 percent 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. In your case, tds should be deducted on the date of payment or date of credit in books whichever is earlier i.e. 15.5.2015 and you have deducted it on 15.12.2015. Hence, interest @ 1% per month (simple interest) shall be paid for 9 months.(₹900) Interest on late deposit shall not be levied as the same is deposited within the time limits prescribed under the act.

Read more at: /forum/tds-late-deduction-or-non-payment-372998.asp