Monday, November 1, 2010

Interest Rate on Late Deposit of TDS

Friends,  As a deductor it is mandatory duty to deposit TDS/TCS in time. In case any TDS/TCS amount  is  not deposited in due time.   It attracts interest on late deposit of TDS/TCS (Tax deduction at source/ Tax collected at source).  Before 30/06/2010, interest rate on late deposit of TDS/TCS  was only 1% p.m. for each month  or any part thereof.  But now Interest rate has been increased after 30/06/2010 from 1% to 1 and half (1.50%) p.m for each month or any part thereof.

Therefore all deductors are requrested to deposit TDS/TCS in due time.   If any deductor deposit TDS only after 1 day from due date.  It does not mean that only one day itnerest will be charged.   Income Tax Department will charge interest for a month instead of a day.
(Overall Interest rate is 18% instead of 12% p.a. w.e.f. 01.07.2010)
One more thing is that interest amount should be deposited before submitting e-tds/e-tcs return/statement.

New TDS Rate with Excel TDS Calculator (Click here)

Intense Debate Comments