Solutions to the top queries about Late Payment and Late Deduction

What should I do in case of Late Payment / Late Deduction intimation received?

The default amount will have to be deposited through challan no 281 by ticking minor head ‘400’. Download conso file from TRACES for filing correction and update the challan detail. While filing correction, fill up interest amount in column no. 403 in Form 26Q, column no. 304 in Form 24Q, column no. 705 in Form 27Q and column no. 655 in Form 27EQ. Mention default interest amount in second last interest column in challan detail of conso file. (Refer e-tutorial – https://www.tdscpc.gov.in/en/download-nsdl-conso-file-etutorial.html).

Note: In case of paper return, interest amount should be mentioned in annexure.

What is the procedure of calculating interest on Late Payment?

Deposit late payment interest @ 1.5% per month or part of the month from the date of deduction till date of deposit.

Procedure for calculating Late Payment:

Calculation

No. of months in Defaults = 3 i.e., Mar-12 to May-12

4000*1.5%*3(Months) =180.00

What is the procedure of calculating interest on Late Deduction?

You have to deposit late deduction interest @ 1% per month or part of the month from the date of payment / credit to deductee till date of deduction.

Procedure for calculating Late Deduction:

Correct Calculation

No. of months in Defaults=1 i.e., 3-Mar-2012 to 4-Mar-2012

10000*1%*1(Months) =100.00

While filing a correction statement I quoted Late Deduction Interest amount in ‘Other’ column. How can I rectify?

Deductor can file a correction statement, delete the amount from ‘Other’ column and mention interest amount in interest column no. 403 in Form 26Q, column no. 304 in Form 24Q, column no. 705 in Form 27Q and column no. 655 in Form 27EQ. You also need to mention demand amount of interest in second last column of interest in challan details.

 

2 thoughts on “Solutions to the top queries about Late Payment and Late Deduction

  1. Yash Doshi

    Hiee all experts,

    One of my client was under a view that his party won’t cross the basic limit for TDS u/s 194C which is 75,000/- per year, so under this assumption he didn’t deducted any TDS towards the payment made to his party. But in the month of March he came to know that due to this bill the basic exemption limit have crossed. So kindly help me with this that would should my client do in this situation.

    Please help me.

    Reply

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