Rule For TDS

Section 194A – TDS on Interest other than Interest on Securities

• Section 194A deals with deduction of TDS on interest other than interest on securities like Interest on Fixed Deposits, Interest on Loans and Advances other than banks.

The Payer/Deductor shall deduct TDS if the amount of such interest paid or credited OR is likely to be paid or credited in a financial year,  exceed

1. 10,000 where the payer is
   1. Banking company or any bank or a banking institution
   2. Co-operative society engaged in the business of banking
   3. Post office (on deposit under scheme framed and notified by Central Government).
2. 5,000 in any other case

TDS will be deducted by Firm B, while making interest payment to Firm A

Thanks for Your reply.

But if Person B did not deducted TDS & did not file TDS Return and paid intrest to Firm A also, than what is the role of Firm A ? 

Firm A will show that whole amount of interest as its Income and will pay Tax on that income itself.

But, if Firm B is liable to deduct TDS but didnt deduct then read Consequences

"Link" https://blog.cleartax.in/consequences-of-not-deducting-tds-timely/

 

In view of the coronavirus pandemic spreading its wings and impacting the economy, Finance minister Smt. Nirmala Sitharaman declared a set of steps to enhance, extension of legislative and regulatory compliance's.

For delayed deposit of TDS, interest has been reduced to 9 % from 18% for those where the TDS is due from 20.03.2020 to 29.06.2020. This benefit is available only if such TDS is remitted to the credit of government on or before 30.06.2020.

Calculate interest on late payment, late deduction, & Filing of TDS using this TDS Interest Calculator:

https://officeanywhere.io/incometax/tds_interest_calculator