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Tds late payment interest u/s 195
bu government in extreme exigency.
Mam, i didn't get your answer...could u plz elaborate?
is a seperate head and edu cess is a seperate head.
Sorry for name confusion sir, Sir i am booking journal entry for tds on royalty under section as below:-
Royalty fee A/c Dr 10000
To tds payable A/c Cr. 1000
To health & education cess payable A/c Cr. 40
To Party A/c Cr. 8960
Is this entry right in books?
health and efucation cess dr.
to bank....
Sir it means we will first book cess in liability account as i booked in first entry then we will debit it when making payment...is it right??
It's Right
1. TDS u/s 195 is to be deducted at the rates in force. TDS for royalty is to be deducted @ 10% (at the rates in force). Edu cess on 10% comes to 10.4% effectively.
2. Before making the payment to Non Resident TDS u/s 195 @ 10.4% is to be deducted.
3. If failed to deposit the amount of tax, then interest @ 1.5% p.m is to be paid on the entire amount of TDS deducted.
4. In your case interest is to be calculated on the entire amount of tax (including Edu cess) and arrive at interest u/s 201(1A).
Please correct me if the above solution has an alternative view.
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