TDS is required to be deducted under this section for payment made for interest to a resident person. TDS is deducted under section A only when payment is made to a resident, if such payment is made to non-resident then tax is to be deducted under section TDS is to be deducted at the time of payment or credit to the account of the payee, whichever is earlier. Where any amount of interest is credited to any account whether called Interest payable account or suspense account or any other name, provisions of this section shall apply and tds is to be deducted.
No surcharge, education cess or SHEC shall be added to the basic rates. Section A of income tax act provides for deduction of tds on payment made regarding interest. For example if bank pays Rs. Since the amount is more than Rs. Even is such amount is not actually paid and only credited to customer account then also TDS is to be deducted. TDS is deductible under section A from payment made for interest other than interest on securities.
Now the question arises whether TDS is also deductible when interest is payable due to delayed payment to suppliers. From reading of the above section it can be concluded that interest paid for delayed payment of purchase bills cannot be considered as interest for income tax act.
In the case of ITO vs. Your email address will not be published. Save my name, email, and website in this browser for the next time I comment. As a business, you surely have payments or expenses apart from salaries that are subjected to TDS like professional fees, interest, rent, etc.
You have to deduct TDS accurately and file quarterly returns, providing details of all business payments and tax thereon. If you execute these errands manually, it becomes a tedious and labour-intensive task. It takes a significant amount of time to complete the entire filing process depending on the number of payments made. So, instead of things getting out of control, you can simply automate your payroll process and not worry about compliance.
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