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Interest on late deposit of tds

TDS / TCS 963 views 2 replies

 

Hello everybody!!

I have a doubt....How to calculate 'MONTH" in income tax act. What is the definition of Month in income tax act??? For clarification take the given below example

Payment Date : 30.12.2011

Commission Amount paid : 150000/- 

Grossing up the paid amount and considered Total commission as Rs. 166667/- and TDS as Rs.16667/- deducted on 30.12.11

Date to be deposit of TDS - 07.02.2012

Now question is how the no. of months taken for interest on late deposit of TDS??

1) 3 months as

30.12.11 to 31.12.11 - 1 month (as part of month)

01.01.12 to 31.01.12 - 1 month

01.02.12 to 07.02.12 - 1 month (as part of month)

2) 2 months as

30.12.11 to 28.01.12 - 1 month (as 30 days month)

29.01.12 to 07.02.12 - 1 month (as part of month)

Please clarify with suitable clauses...considering the above example???

Thanks & Regards,

Hammad

 

Replies (2)

Correct calcualtion is this

 

1) 3 months as

30.12.11 to 31.12.11 - 1 month (as part of month)

01.01.12 to 31.01.12 - 1 month

01.02.12 to 07.02.12 - 1 month (as part of month)

 

Month or part of the month is even one day is one month. so TDS Deductible or deducted on Dec.-11 and paying on 7/2/12, so Jan-12 & Feb-12 2 months so total 3 months interest

 

 

Part of month also called one whole month, interest is to be caculated next higher 100 rupees, not nearer


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