TDS on expenses provided at the year end

Dear Kannan,

Interest is payable on TDS u/s 201(1A) of Income Tax Act, 1961 @ 1.5% p.m. from the date of deduction till date of deposit. Inythis case from April to August in case TDS is remitted in August itself.

Dear Kannan

As per rule no 30 of the IT rules, TDS has to be paid within 7 days from the end of the month in which the deduction take place (or the income tax is due under section 192(1). Considering the current discussion, the TDS on the provision for expenses made during March of any financial year is only allowed to be paid before 30th April. Hence any provision made during August closing needs to be paid on or before 7th of September.

Financial Year for the purposes of Income Tax Act, 1961 and rules made thereunder is

APRIL 1 TO MARCH 31.

Time limit of 1 month i.e. upto April 30 is available only for the month of MARCH and not for LAST month per se.

Even if the FY for the company is ending on August, the Due date of Payment of TDS for the provisions made on August 31 will be SEPTEMBER 7.

NOTE: you will also have to make a reconciliation statement, as Previous year for Income tax purposes is April 1 to March 31.  Also you will have to consider Provisions of MAT,etc.