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Interest on late payment

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(Querist)
12 June 2012 Interest on late payment of Service tax is payable on day basis or month basis
For e.g
Due date 05.04.12
Paid on 10.04.12
Interest will be paid for 1 month @1.5% or for 5 days@18% ????????
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RENGARAJ R.K

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RENGARAJ R.K (Expert)
12 June 2012 Rate of Interest:
From 01.04.2011 - 18% per annum.

Interest for late payment is worked out on day basis.


Failure to pay service tax attracts also penalty under section 76 of the Act which shall not be less than Rs.200/- for every day during which such failure continues or @ 2% of such tax per month whichever is higher.

rengaraj r.k
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neeraj

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neeraj (Querist)
12 June 2012 Sir but i think interest is to be payable from due date till date of payment i.e. from 5th March 2011 to 10th April 2012
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CA Akshay Yetiwar

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CA Akshay Yetiwar (Expert)
13 June 2012 Yes interest is to be calculated on day basis @ 18% p.a.
In your case due date is 5-4-12 nad it is paid on 10-4-12. so interest is to be paid for 5 days @ 18% per annum.
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