Interest On Late Payment Of TDS 2011: How Do I Pay Online?

TDS or tax deducted at source is one of the most common ways of collecting taxes from a person. In this mode of taxation, a certain percentage of payment to a person is automatically deducted at the time of payment. This is forwarded to the government by the person. It is a kind of ‘pay as you earn’ scheme. Trouble is, at times an unwilling delay in paying this tax may result in a form of penalty payment.

Usually, a percentage of interest is charged on the total amount due- and you have to pay this to the government. What is the interest on late payment of TDS- 2011? Let’s take a look.

The interest on late payment of TDS -2011 is calculated at the following rates:

  • If you consider the period before 1.4.08, the interest will be chargeable at the rate of 12% per annum.
  • However, if the period you are considering is one after 1.7.10, you’ll be charged at the rate of 1.5% for every month that you did not pay the TDS.
    This is applicable for late remittances. If the TDS was late right at the deductions stage, you’ll be charged at 1% for every month. What’s more, even if you have defaulted on the payment for a part of the month, you’ll be charged interest for the whole month.

There are certain other points you need to consider when you are thinking about interest on late payment of TDS 2011. These are:

  • When you are considering interest on the TDS amount payable (particularly the portion on which you have to pay interest), you should round off the amount to the nearest multiple of 100. All other fractions will be ignored when you are making this calculation.
  • Your interest liability is absolute. This means you and only you are in charge of making the corrected deposit. The assessing officer is not responsible for making any exemptions on your interest liability.
  • Since 1.6.2006, you must pay the interest on the late TDS before you file for the quarterly returns. For every delay in remittance, you have to pay interest at the rate of 1.5%.

The rules for interest on late payment of TDS on salary are the same as the above.

These are the rules you have to go by when you are calculating interest on late payment of TDS- 2011.


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1 comment

  1. PP

    We have passed the entry for Professional fees on 31.12.2011 and we have not yet paid TDS.
    1. If we paid TDS in the month of Jan 12, how many months do we have to pay late payment on TDS?
    2. If we paid TDS in the month of Feb 12, how many months do we have to pay late payment on TDS?

    Also provide any circulars or Notification for late payment on TDS. We have received a TDS Default Notice for our company.

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