Every individual desires to pay a minimum amount in tax and there is nothing wrong with that as...
To understand the TDS Penalty and late Fee provisions we have to go through first basic provisions of the TDS E.g. Due date of TDS payment, the filing of return etc.
At the time of payment getting due or actual payment (whichever is earlier)
As per Section 201 of the income tax act 1961 if a person who is liable to deduct TDS Penalty but failure to deduct TDS or after so deducted fails to pay, the whole or part of the tax credit to the government then such person shall be liable to pay simple interest as given below:-
E.g. XYZ Ltd. A paid fee of Rs. 1, 00,000/- on 23rd July to Mr. Sanjay Sharma u/s 194J for the month July.
However, the TDS on such amount could not be deducted on time hence the TDS Penalty is deducted on 23rd August and deposited to 15th sept
Ans. 1.TDS to be deducted @10% i.e. 10,000/-
At the time of payment getting due (23rd July 20XX, Assumption) OR
Actual payment (23rd July 20XX)
Financial Year 2017-18
|Quarter Ending||Due date for filing of TDS return(Both for government and other DDeductor||Due date for TCS Return|
|30/June/2017||31st July 2017||15th July 2017|
|30/Sept/2017||31st Oct 2017||15th Oct 2017|
|31/Dec/2017||31st Jan 2018||15th Jan 2018|
|31/March/2018||15th May 2018||15th may 2018|
|Quarter Ending||Due date for filing of TDS return(Both for government and other Deductor)||Due date for TCS Return|
|30/June/2018||31st July 2018||15th July 2018|
|30/Sept/2018||31st Oct 2018||15th Oct 2018|
|31/Dec/2018||31st Jan 2019||15th Jan 2019|
|31/March/2019||15th May 2019||15th may 2019|
A person who fails to file TDS/TCS return on due Date liable to pay penalty u/s 234E & 271H
As per section 234E of the Income Tax Act 1961 where a person fails to file TDS/TCS return then such person shall along with return shall liable to submit the details to pay “Late Fee” of Rs.200 per day till the default continue. Such amount shall be calculated from the due date of the return.
However, the amount of late fee shall not exceed the amount of TDS.
As per section 271H of the Income Tax Act, 1961 where a person fails to file TDS/TCS Return or File incorrect TDS/TCS return shall be liable to pay following penalty:-
Minimum Rs. 10,000/-
Maximum Rs. 1, 00,000/-
The penalty under section 271H is in addition to the “Late Fee” u/s 234E
However no penalty u/s 271H can be levied if the following conditions are satisfied:-
However, the penalty under the section can only be waived off if condition u/s 273A (4) is satisfied.
However such immunity is only available if there was reasonable cause for such failure.