TDS is to be deducted on payment or credit basis, whichever is earlier.
What will be the conciquences in case of:
I had received a bill on professional services 10/11/2014 for Rs. 100,000, i entered the same in my accounts without providing TDS on 10/11/2014.
I paid the party on 15/12/2014 after deducting TDS and deposited TDS on 07/01/2014.
In this case will there be any Interest Liability?
TDS should have been deducted u/s 194J in the month of Nov.and deposited till 7th Dec.
interest will be charged on TDS amount @ 1% p.m. for three months. i.e.( From Nov.2014 to Jan.2015 i.e.)
Interest On TDS Rs.10000 x 1% x 3 = Rs.3000/-
Calculation mistake
Interest on TDS
Rs.10000 x 1% x 3 = Rs.300/-
Better is to change the date of bill from Nov.2014 to Dec.2014 And make the journal entry in dec.14 , hence, no interest will be payable.
Thank u sir..
CAclubindia
