Tds on director's remuneration

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jayesh (Querist)
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19 July 2013 Company has not deducted TDS on director's remuneration. Can we treat it as a salary expense. And if we can not treat it as salary then what will be the penalty or interest that my client has to pay.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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19 July 2013 If TDS is not deducted then it is advisable to deduct the TDS amount and deposit the same. Also file/rectify e-tds return.
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In such a case, employer has to pay simple interest @ 1% per month or part of the month, from the date when the tax amount becomes deductible to the date when the tax is actually deducted.
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After deduction if the tax is not deposited on or before the prescribed time then interest @ 1.5% per month or part of the month is payable.
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On late filing of E-TDS return, Late fee of Rs. 200/ day will be payable.

jayesh

jayesh (Querist)
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20 July 2013 So if I deduct the TDS in July,2013 and deposit it before 7 August then i don't have to pay interest @ 1.5% for not deposited TDS.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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20 July 2013 Practically- it is right but I do not advise to do so.
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As,I can't say- how TDS CPC deal with this matter ?.
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However, It is advisable to pass the JV for TDS on the date of depositing the tax.
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jayesh

jayesh (Querist)
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20 July 2013 Thank you.

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