what is the penalty for non compliance ot Income Tax rules 87 & 88
Mahananda
(12 Points)
Replied 16 April 2015
Hi Srividya,
As far as Income Tax Act, 1961 ('the Act') is concerned there is no penalty as such to Employer, however employer can claim deduction as business expenditure only upon actual payments of such (Employer +Employee's) contributions, as per Section 43B(b) of the Act .
As far as The Employees’ Provident Fund Scheme, 1952 ('the Scheme') is concerned, following penalty interest is applicable to Employer for delay/default in PF Contribution as per Section 32A of the Scheme.
Two months and above but less than four months = 22 % per annum
Four months and above but less than six months = 27 % per annum
Six months and above = 37% per annum
The interset is calculated on the amount payable for the number of days of delay in making payment.
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