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Interest on non deduction of tds

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This query is : Resolved

CA. Abhishek A. Sawant (Querist)

07 September 2014 While doing audit of one of my client i found that in one case TDS was not deducted by client. As client follows Mercantile Acconting System, i instructed him to make the provision for TDS liability. E.g. Bill Payment made Rs.35000 dated 31.03.2014 Liability created for TDS as on same day for TDS. I want to know at what rate interest will be charged?? 1% : For NON deduction 1.5%: For deduction but NON deposit If my client passes TDS entry as on 31.03.2014,meaning is TDS deducted on that day as payment or credit whichever is earlier. Then he has to pay 1.5% though he has not actually deducted TDS. Plz anyone explain.

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)

07 September 2014 In the given case if TDS deposited within 30.04.2014 no interest required to be paid. If paid after that interest on late deposit will have to be paid @1.5% per month or part thereof.

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