Interest on late deduction of tds

In case of my company amount of 50,000 was credited to the party's account for section 194C on 05-07-2016. But at that time TDS was not deducted.

However, TDS of 500 was deducted at the time of payment of 49,500 to the party on 25-07-2016.

Does in this case interest u/s 201(1A) is applicable for late deduction?

(In my view it is not applicable as TDS was deducted in the same month. But I am not sure, Kindly reply)

Thanks.

Replies (5)

yes, as tds should be deducted on the date of payment or amount credited in account whichever is earlier.

so this is a case of late deduction of tds hence the same will be liable to pay interest @ 1% per month or part thereof.

Dear dhaval,

Tds should be deducted on the date of payment but u have deducted late hence late penalty is applicable 

 

Kindly like if my forum has helped you 

Originally posted by : Dhaval

In case of my company amount of 50,000 was credited to the party's account for section 194C on 05-07-2016. But at that time TDS was not deducted.

However, TDS of 500 was deducted at the time of payment of 49,500 to the party on 25-07-2016.

Does in this case interest u/s 201(1A) is applicable for late deduction?

(In my view it is not applicable as TDS was deducted in the same month. But I am not sure, Kindly reply)

Thanks.

 

Interest or Penalty is not applicable as date of payment and date of deduction is 25-07-2016

No penalty applies in this case.

No Penalty applies. Because the amount of TDS would payable on 07-08-2016.

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