Interest on delayed payment of tax: Section 50 of CGST Act, 2017
ABC ltd needs to pay the GST of Rs.10 lakh on or before 20th May, 2018. However, it only manages to pay the tax on 20thJune, 2018. Please calculate the Interest on tax which is to be paid. To calculate the correct interest we need the following:
Interest rate (18% as per section 50)
No. of days default (31 days, we shall not count 20th may)
Outstanding tax (Which is Rs.10 lakh)
Hence, interest on late payment of tax will be Rs.15,287/- (10 lakh*18%*31/365).
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