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.
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.
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.