TDS Interest & Penalty Calculator

Interest for Non-Deduction / Short Deduction
If any person fails to deduct the whole or part of TDS as required under Chapter XIX-B, he shall pay simple interest at the rate of 1% per month or part of month on the amount of TDS not deducted. The period runs from the date on which TDS was deductible to the date of actual deduction. Proviso: Where such person is an individual or HUF and the total sales/gross receipts/turnover do not exceed ₹1 crore, the rate is reduced to 0.75% per month or part of month.

Interest for Late Deposit
Where TDS has been deducted but not deposited to the credit of the Central Government within the prescribed time, simple interest at the rate of 1.5% per month or part of month shall be paid. The period runs from the date of deduction to the date of actual deposit. This interest is not deductible as business expenditure u/s 37.

Interest for Non-Collection / Short Collection (TCS)
If any person fails to collect the whole or part of TCS, he shall pay simple interest at the rate of 1% per month or part of month on the amount of TCS not collected, from the date of such collection to the date of actual collection.

Consequence of Failure to Deduct or Pay TDS
If any person fails to deduct TDS, he shall be deemed to be an assessee-in-default in respect of such tax. The Assessing Officer may recover the TDS amount together with interest u/s 404 as an arrear of tax.

Penalty for Failure to Deduct TDS
Penalty equal to the amount of TDS not deducted or not paid may be levied by the Joint Commissioner. The penalty is equivalent to the tax not deducted / not paid.

Fee for Delay in Filing TDS Return
If a person fails to file the TDS return on or before the due date, a fee (not penalty) of ₹200 per day of delay shall be levied. The total fee shall not exceed the TDS amount.

Penalty for Failure to File TDS Return
A minimum penalty of ₹10,000 and maximum of ₹1,00,000 may be levied for failure to file TDS return or furnishing incorrect information.

TDS deposited via Challan No. ITNS 281. Government deductors without Challan deposit same day or by 7th of next month. Non-government deductors: 7th of following month (except March — 30th April).

TDS returns filed quarterly: Form 24Q (salary), 26Q (non-salary), 27Q (NRI payments). Due dates: Q1 — 31 Jul; Q2 — 31 Oct; Q3 — 31 Jan; Q4 — 31 May.

Failure to deduct or pay TDS: Penalty equal to the amount of TDS not deducted / not paid. Levied by Joint Commissioner of Income Tax. This is a mandatory penalty with limited discretion.

Delay in filing TDS return: ₹200 per day of delay from due date till date of filing. Total fee capped at the amount of TDS for that period. Charged automatically; shown in intimation.

Failure/incorrect filing of TDS return: Minimum ₹10,000, Maximum ₹1,00,000. Applicable for: non-filing, incorrect PAN, incorrect amount, incorrect challan details. Penalty waived if return filed within 1 year from due date AND TDS paid with interest.

Failure to pay TDS to Government after deduction: Rigorous imprisonment for a term of 3 months to 7 years with fine. This is a criminal offence.

Expenditure on which TDS not deducted/paid: 30% of the sum paid / payable is disallowed as business expenditure. Remedied if TDS deposited in subsequent year — deduction allowed in that year.

Where TDS is not deducted, the deductor is treated as assessee-in-default. Recovery of TDS + interest can be made as arrears of tax. However, if the payee has paid tax on the income, the deductor is not treated as assessee-in-default (but interest is still payable).