1. What is TDS Interest for Late Payment?

TDS (Tax Deducted at Source) interest is charged at 1% per month for late deposit of TDS to the government. This interest is applicable from the date of deduction to the actual date of payment.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• \( TDS \) — Tax Deducted at Source amount in INR
• \( 1\% \) — Monthly interest rate (as per Indian tax laws)
• \( Months\ Delayed \) — Number of months between deduction date and payment date

Explanation: The interest is calculated on simple interest basis at 1% per month or part thereof.

3. Importance of TDS Interest Calculation

Details: Accurate interest calculation is crucial for compliance with tax laws and avoiding penalties. Late payment of TDS attracts interest under Section 201(1A) of the Income Tax Act.

4. Using the Calculator

Tips: Enter the TDS amount in INR and the number of months delayed (rounded up to nearest whole month). The calculator will compute the interest payable.

5. Frequently Asked Questions (FAQ)

Q1: What is the due date for TDS payment?
A: For government deductors - same day. For others - 7th of next month (except March).

Q2: Is interest compounded monthly?
A: No, it's simple interest calculated monthly.

Q3: How are partial months calculated?
A: Any part of a month is considered as a full month for interest calculation.

Q4: Are there additional penalties?
A: Yes, late filing may attract penalty under Section 234E of ₹200 per day.

Q5: Can this interest be claimed as deduction?
A: No, interest paid under Section 201(1A) is not deductible.