TDS penalty

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  1. ecourierz

    ecourierz New Member

    Hi,
    We haven't deducted TDS on commission for last financial year, which crossed Rs.15000, it has crossed on 07.09.2015, total commission paid for last year was Rs.33862.51.

    can we know how much penalty or interest need to pay to gov? is it necessity to pay interest as we haven't deducted any TDS yet?

    Pls guide me
     

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  2. ecourierz

    ecourierz New Member

    hello,

    But recently i have checked some articles, for commission amount limit is Rs.15000, if we crossed that we have to deduct TDS like, I need clarify on this

    Secondly if you check which I have shared a excel sheet in that from 1.4.15 to 9.6.16 not at all crossed the limit value,

    Pls let me know should I pay penalty + interest for this , if yes how much i need to pay any calculation?
     
  3. ZED

    ZED Well-Known Member

    Sorry I misread the commission as something else.

    Yes that's correct. Earlier the limit was mere 5000 and the rate was 10%, now the rate is 5% and the limit is 15,000.
    But this has came in to effect from 01.06.2016.

    Prior to this date, the commission has been 11 ,432.03 out of which
    4125.5 pertains to the month of April and remaining 7306.53 to the month of May.

    You should have deducted the tax as soon as the limit was of 5K was crossed.
    Accordingly the interest should be charged @1% from the month of May till the month of actual deduction. [We have to consider the part of the month as a full month.]
    2 months interest @1% per month is payable by you on the amount of
    TDS.
    If there is delay in depositing the tax with govt. after the deduction of tax then there will be additional interest of 1.5% per month.
    [Penalty is not to be paid by you unless specifically asked to pay.]

    I am citing the relevant extracts for your reference.

    194H. Any person, not being an individual or a Hindu undivided family, who is responsible for paying, on or after the 1st day of June, 2001, to a resident, any income by way of commission (not being insurance commission referred to in section 194D) or brokerage, shall, at the time of credit of such income to the account of the payee or at the time of payment of such income in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rate of five per cent :

    Provided that no deduction shall be made under this section in a case where the amount of such income or, as the case may be, the aggregate of the amounts of such income credited or paid or likely to be credited or paid during the financial year to the account of, or to, the payee, does not exceed fifteen thousand rupees :



    [Interest]
    S.201(1A) Without prejudice to the provisions of sub-section (1), if any such person, principal officer or company as is referred to in that sub-section does not deduct the whole or any part of the tax or after deducting fails to pay the tax as required by or under this Act, he or it shall be liable to pay simple interest,—

    (i) at one per cent for every monthor part of a monthon the amount of such tax from the date on which such tax was deductible to the date on which such tax is deducted;
    (part of a month means even if there is delay of one day, it shall be treated as delay of one full month)

    and


    (ii) at one and one-half per cent 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,
     
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