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Rounding off for calculation of Interest u/s 234A/B/C

27 January 2019

Is it necessary to round off tax amount which is multiplied by interest rate to be rounded off to multiple of hundreds and if yes, where is such provision regulating such practice?

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3 Replies

RAMAKRISHNAN R (INCOME TAX OFFICER) (1736 Points)
Replied 28 January 2019

PLS refer section 288B

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Rahul Falodiya (16 Points)
Replied 28 January 2019

Sex. 288B is silent for sec. 234a/b/c

Chandra Sekhar (7 Points)
Replied 21 July 2019

Rounding Off - Rule 119A For the purpose of calculation of interest payable or receivable by the assessee, the amount on which interest is to be calculated shall be rounded off to the nearest multiple of Rs 100 and any fraction has to be ignored.

Illustration If income tax liability is 143575 and 43500 has been paid as TDS/SAT For the purpose of calculation 234ABC interests, 143575-43500=100075 As per Rule 119A, 100075 has to be rounded off to 100000 thereby ignoring the fraction 75. Note: included the above redundant illustration only to get this reply posted. For some reason simple replies are not allowed to be posted on this forum

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