Tds
This query is : Resolved
05 March 2016
Sir,
In case I forgot to deduct TDS of any person which was in the month of December.. & in the next month I.e January, I deposited challan considering the date of deduction to be of January then the due date of depositing tax will be 7th of next month I.e feb??
05 March 2016
If your books of account reflect the entry of the bill / payment whichever is earlier in the month of January then the due will be 7th of February. Otherwise the date would be 7th January and you will be liable for interest on the deducted month from 1st December till date of payment. If the TDS is on payment made in advance, the date of clearing of the issued cheque would be important - e.g if your bank statement reflects the date of clearance as 24th December, there is no way you can show the payment in January. But if the TDS is on debiting of the invoice received, the entry date can be changed to January, irrespective of the date of invoice, and the TDS liability shifted to February.
05 March 2016
If your books of account reflect the entry of the bill / payment whichever is earlier in the month of January then the due will be 7th of February. Otherwise the date would be 7th January and you will be liable for interest on the deducted month from 1st December till date of payment. If the TDS is on payment made in advance, the date of clearing of the issued cheque would be important - e.g if your bank statement reflects the date of clearance as 24th December, there is no way you can show the payment in January. But if the TDS is on debiting of the invoice received, the entry date can be changed to January, irrespective of the date of invoice, and the TDS liability shifted to February.
05 March 2016
Sir,
Actually the point is about payment of int on late payment.
As per rule 30 it states that the tax needs to be deposited on or before 7th of next month in which DEDUCTION is made.
As I am deducting tax in the month of January therefore I shall not be held liable to pay int in late payment if I deposit the tax upto 7th feb. as per rule 30
Also I am ready to pay the int on late deduction but why shall I pay int on late payment as I was not holding any amount of govt during dec or even January if it is paid by me upto 7th feb.
27 July 2025
Got it — here’s the clarification on your concern regarding interest on TDS late deduction vs late payment:
---
### Key Points:
* **TDS Deduction Date:** The date when you actually deduct TDS (i.e., when the amount is deducted from the payment to the vendor/contractor).
* **TDS Deposit Due Date:** The tax deducted must be deposited **by the 7th of the next month** following the month in which TDS is deducted.
* **Interest Liability:**
* Interest under **Section 201(1A)** is payable for **late deduction of TDS** — i.e., if you failed to deduct TDS on time.
* Interest under **Section 201(1A)** is also payable for **late deposit of TDS** — i.e., if you deducted but didn’t deposit the amount to the government within due date.
---
### Your Scenario:
* You **forgot to deduct TDS in December** (say on payment/invoice dated December).
* You **deducted TDS only in January**.
* You deposited the TDS in January, and so you want to know if interest is payable for late deposit.
---
### What the law says:
* **Due date for deposit is 7th of next month after deduction** (Rule 30).
* Since you deducted in January, you must deposit by **7th February**.
* **Interest on late deduction:**
Since TDS was deducted late (in January instead of December), you are liable to pay interest from **1st December till the date of deduction** (i.e., for late deduction).
* **Interest on late deposit:**
Since you deposited within the due date (by 7th February), **no interest is payable on late deposit**.
---
### Important:
* The **interest starts as soon as the deduction is delayed**, not necessarily for deposit delay if deposit is on time.
* So, **you owe interest for late deduction** but **not for late deposit** if deposited by due date post-deduction.
* Your argument that you didn’t hold govt money before deduction is valid for late deposit interest but **not for late deduction interest** because liability to deduct arises at time of payment or credit.
---
### Summary:
* Interest on **late deduction**: Payable from December 1 to deduction date in January.
* Interest on **late deposit**: Not payable if TDS is deposited by 7th Feb (7th next month of deduction).
---
---
### Key Points:
* **TDS Deduction Date:** The date when you actually deduct TDS (i.e., when the amount is deducted from the payment to the vendor/contractor).
* **TDS Deposit Due Date:** The tax deducted must be deposited **by the 7th of the next month** following the month in which TDS is deducted.
* **Interest Liability:**
* Interest under **Section 201(1A)** is payable for **late deduction of TDS** — i.e., if you failed to deduct TDS on time.
* Interest under **Section 201(1A)** is also payable for **late deposit of TDS** — i.e., if you deducted but didn’t deposit the amount to the government within due date.
---
### Your Scenario:
* You **forgot to deduct TDS in December** (say on payment/invoice dated December).
* You **deducted TDS only in January**.
* You deposited the TDS in January, and so you want to know if interest is payable for late deposit.
---
### What the law says:
* **Due date for deposit is 7th of next month after deduction** (Rule 30).
* Since you deducted in January, you must deposit by **7th February**.
* **Interest on late deduction:**
Since TDS was deducted late (in January instead of December), you are liable to pay interest from **1st December till the date of deduction** (i.e., for late deduction).
* **Interest on late deposit:**
Since you deposited within the due date (by 7th February), **no interest is payable on late deposit**.
---
### Important:
* The **interest starts as soon as the deduction is delayed**, not necessarily for deposit delay if deposit is on time.
* So, **you owe interest for late deduction** but **not for late deposit** if deposited by due date post-deduction.
* Your argument that you didn’t hold govt money before deduction is valid for late deposit interest but **not for late deduction interest** because liability to deduct arises at time of payment or credit.
---
### Summary:
* Interest on **late deduction**: Payable from December 1 to deduction date in January.
* Interest on **late deposit**: Not payable if TDS is deposited by 7th Feb (7th next month of deduction).
---
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