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How to calculate the tds & late payment interest

roshan ramesh gajamal (Accountant) (24 Points)

30 October 2013

Please tell how calculate the TDS & Interest on Late payment of TDS....

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3 Replies

CA Chirag (Chirag Sheth & Associates) (1183 Points)
Replied 30 October 2013

dear,

say for an example following details are there:

1. Agreement provide professional services. Fees charged Rs.60000

2. Service tax extra as applicable.

Tds will be deducted on Rs. 67 416[ 60000+12.36%of 60000 = Rs. 67 416]. This bill is say for professional service.

hope it will clear your doubt.

TDS is required to be deposited with Government within 7 days from the end of month.

thanks

chirag.

CA Pallav Singhania (❤ Work Hard Party Harder ❤) (32102 Points)
Replied 30 October 2013

If a person fails to deduct the whole or any part of the tax at source, or, after deducting, fails to pay the whole or any part of the tax to the credit of the Central Government within the prescribed time, he shall be liable to action in accordance with the provisions of section 201. Sub-section (1A) of section 201 lays down that such person shall be liable to pay simple interest

Example of Interest Calculation

Date Of Payment	Date of Deduction	Due Date	Date of Deposit	Delayed Deposit		Delayed Deduction
				Months	Rate	Months	Rate
01/04/2010	01/04/2010	07/05/2010	09/05/2010	2	1%	-	-
09/04/2010	09/04/2010	07/05/2010	09/05/2010	1	1%	-	-
01/07/2010	04/08/2010	07/09/2010	07/09/2010	-	-	2	1%
01/07/2010	04/08/2010	07/09/2010	15/09/2010	2	1.50%	2	1%

Interest is to be calculated for every month or part of a month comprised in a period, any fraction of a month shall be deemed to be a full month The amount of tax, penalty or other sum in respect of which such interest is to be calculated shall be rounded off to the nearest multiple of one hundred rupees and for this purpose any fraction of one hundred rupees shall be ignored and the amount so rounded off shall be deemed to be the amount in respect of which the interest is to be calculated.