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kalaivani.c (Querist)
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22 November 2013 Sir,
one of our clients tax deducted at the time of payment but deposited into government account after the due date (i.e. after 7 th day of succeeding month) my question is for how many months have to calculate interest?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 November 2013 normally two months.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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22 November 2013 Suppose tds deducted on 28th nov 2013 but paid to govt on 9th dec 2013 then u need to pay int for 1 month as the law says @1% per month or part thereof...means part is converted to full month.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 November 2013 Tushar Bhai,

this is the whole confusion. While we all believe that interest should be charged for one month, the tax department calculated interest for two months November and December. This often leads to short interest paid notices and prolonged appeal process.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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22 November 2013 i have my self paid only for 1 month which was accepeted by ito in my above type of eg.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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22 November 2013 tushar bhai I totally agree to what you are saying. But on more than one occasion we have received notice for short interest payment. Problem is that the cost of replying to those notices and appeals in much more than the short interest amount.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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22 November 2013 yes i agree the cost is more then the benefit we rec in saving tax.

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