TDS

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This query is : Resolved

Gayathri (Querist)

25 March 2011 i want to know clearly about TDS interest and penlty.
1)If i fail to deduct Rs.1000 what will be the interest i have to pay
2)If i deducted but failed to remit the same to Government. Then what is the effect?
3) What will be the effect if the ITO finds these omissions(i mean penalty impact)

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)

25 March 2011 https://www.caclubindia.com/articles/all-you-want-to-know-about-tds-7882.asp

Please see above article for details.

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Gayathri

Gayathri (Querist)

25 March 2011 voluntarily if we deduct and make the payment we have to pay interest u/s 201(1)/(1A). Penalty will be levied only if the AO finds. right sir?

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)

25 March 2011 1) If you fail to deduct TDS the said expenditure will be disallowed. Interest payment is required only if you later pay ths TDS on above expenditure. Interest @1% p.m. or part thereof for late deduction.
2) If you deducted and failed to remit the same the same to Govt penalty under sec 221is attracted. Maximum penalty is equal to amount of TAX involved. If late deposited you will have to pay interest @ 1.5% p.m. or part thereof for late deposit. Even on payment of interest penalty u/s 221 can be levied.

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