Interest on Income Tax

[Pradeep Kaushik]

Dear All,

 

I have Deducted the TDS on Salary of My staff. Now there is some Bank Interets  have Added. Because of that the tax liability has been increesed.

My Query is this, Do i have to add Interest u/sec 234b,234c on the balance Tax:

In Below sheet there is two examples:

 

S. NO.	EMPLOYEE NAME	SALARY INCOME AS PER FORM 16	BANK INTEREST	TOTAL INCOME	INCOME TAX    PAYABLE	TDS BY COMPANY/BANK	BALANCE TAX TO BE DEPOSITED
1	CHO	2,507,293.00	42,552.00	2,549,845.00	628,254.00	613,791.00	14,463.00
2	KYU	1,935,786.00	6,464.00	1,942,250.00	447,715.00	445,719.00	1,996.00

Please clarify, with reference of Rule or Section, in which case i have to add Interest on tax payment.

I have received some suggestion, that if last due tax is not more than 10,000/-, there is no Interest liability.

 

Pradeep Kaushik

 

[Surender Gupta]

As a person liable to deduct TDS, you are not liable to pay interest u/s 234B or 234C.

The only liability is on account of short deduction of TDS as interest u/s 201 of the  Act.

AI Summary

Interest liability for underpayment of tax: deductor not liable under advance-tax provisions, only interest for short TDS applies. Employer deducted TDS on salary but bank interest increased taxable income; the deductor is not liable to pay interest under provisions imposing interest for underpayment or delay of tax by the taxpayer, and the only liability for the deductor is interest arising from short or late deduction/ payment of TDS under the provision addressing tax not deducted or not paid.