Friends, when Tax Deduction at source Deductor has to fail to deposit TDS Tax amount within stipulated time, it may cause to penalize as Interest after deducting the Tax and depositing the Tax credit into the Central Government. It shall be liable to punish under section 201 of Income Tax Act accordance.
The Sub-section (1A) of section 201 laid down for such Deductor shall be liable to pay simple interest.
How to Calculate Simple Interest and Prevent from it?
Interest on late deduction of tax:
(1% per Month) at one percent for every month or part of the month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted and
Interest on late Deposit of Tax :
(1.5% per month)at one and one-half percent for every month or part of a month on the amount of such tax from the date on which such tax was deducted to the date on which such tax is actually paid. Such interest, if chargeable, has to be paid before furnishing of quarterly statement of TDS for each quarter.
Penalty:
Section 271C lays down that if any person fails to deduct whole or any part of tax at source or fails to pay the whole or part of tax deducted, he shall be liable to pay, by way of penalty , a sum equal to the amount of tax not deducted or paid by him.
Prosecution:
Section 276B lays down that if a person fails to pay to the credit of the Central Government within the prescribed time the tax deducted at source by him, he shall be punishable with rigorous imprisonment for a term which shall be between 3 months and 7 years, along fine.
Click Here to Calculate your Interest
The Sub-section (1A) of section 201 laid down for such Deductor shall be liable to pay simple interest.
How to Calculate Simple Interest and Prevent from it?
Interest on late deduction of tax:
(1% per Month) at one percent for every month or part of the month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted and
Interest on late Deposit of Tax :
(1.5% per month)at one and one-half percent for every month or part of a month on the amount of such tax from the date on which such tax was deducted to the date on which such tax is actually paid. Such interest, if chargeable, has to be paid before furnishing of quarterly statement of TDS for each quarter.
Penalty:
Section 271C lays down that if any person fails to deduct whole or any part of tax at source or fails to pay the whole or part of tax deducted, he shall be liable to pay, by way of penalty , a sum equal to the amount of tax not deducted or paid by him.
Prosecution:
Section 276B lays down that if a person fails to pay to the credit of the Central Government within the prescribed time the tax deducted at source by him, he shall be punishable with rigorous imprisonment for a term which shall be between 3 months and 7 years, along fine.
Click Here to Calculate your Interest
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