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Allowability of Interest on TDS and excess tds deposited to dept.?

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Deepak kumar padia

1 Points Posted on 24 May 2023

1. Is interest on Late deposit of TDS allowable ?

2. A Demand notice was issued against short deduction of TDS. Lately such Demand is paid to dept. can we claim it as an expense? (logic - excess tds paid is trfd to creditor a/c and creditor didnot paid such amt hence becoming baddebt)

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Quick Summary

This discussion clarifies the allowability of interest on late TDS deposits and excess TDS paid to the department. Generally, interest on late TDS payments is not considered an allowable expense. However, if excess TDS has been paid and subsequently written off as a bad debt or sundry balance, it can be claimed as an expense.