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Tax query

Arundhati Raychaudhuri (no designation) (340 Points)

20 June 2011

im a non corporate assessee. my tax liability in a.y.2011-12 is26000. i have paid advance tax of30000 on 12.3.11.i'll get refund of4000.

but my question is i have not paid any advance tax on 15.9.10 & 15.12.10. so, will i have to pay interest u/s 234C for those period?

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(Guest)

No u are not required to pay any interest u/s 234C. Interest u/s 234C is payable on deferment of payment of advance tax. Advance tax has to be estimated tax of the whole year. If tax cannot be accurately be estimated at the start of 1st april then it can be adjusted in coming quarters.

In your case this is exactly what happened. First you estimated your tax on your higher side and you paid it. Now the amount of tax has got reduced. therefore there is no shortfall in payment of advance tax.

Therefore no interest.

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CA ADITYA SHARMA (CA IN PRACTICE ) (16719 Points)
Replied 21 June 2011

Originally posted by : kaushal
	No u are not required to pay any interest u/s 234C. Interest u/s 234C is payable on deferment of payment of advance tax. Advance tax has to be estimated tax of the whole year. If tax cannot be accurately be estimated at the start of 1st april then it can be adjusted in coming quarters. In your case this is exactly what happened. First you estimated your tax on your higher side and you paid it. Now the amount of tax has got reduced. therefore there is no shortfall in payment of advance tax. Therefore no interest.