Interest on delayed deposit tds

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CA Abhishek Pal (Querist)
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17 September 2011 most urgent
plz give me advice.

If we credited RS 100000/- as interest on 31st March & TDS deducted of Rs. 20600, due date of deposit of TDS on it 31st May, but not paid & actully paid on 19 Sep. What will rate of Interest charged on TDS amount.

Hari Beldona

Hari Beldona (Expert)
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17 September 2011 Interest is chargeable @ 1.50 per cent for every month or part of the month ,means full month interest will be charged for fraction period of month (With effect from 01/07/2010)

CA Navin Jain

CA Navin Jain (Expert)
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17 September 2011 first i would like to clearly that tds rate on interest is @ 10%, and due date is 30 April if tds has deducted during the month of march.

Interest on tds is calculated 1.5% per month or part of the month, hence in your case interest will be calculated for 7 months.

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Hari Beldona

Hari Beldona (Expert)
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17 September 2011 1.All the TDS deductions made during a month are to be paid on or before7th of the next month.
2.As per your query due date is 7th April.
3.Interest is to be paid on 6 months (April to September- both months are inclusive)
4.Interest on late payment of TDS is not allowable as it is not business expenses.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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17 September 2011 I have a different observation on the rate of interest to be charged u/s 201(1A) of the IT Act,1961.
In the cited situation, interest is to be charged @ 1% from 31st March to 30 th June (period of levy 4 months) and @1.5% from 1st July to 19th September(period of levy 3 months).
Thus total period of levy is 7 months.

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