Skip to content

CA Intermediate · Taxation · Tax Deduction at Source and Collection of Tax at Source

A municipal corporation, a notified deductor, deducted GST TDS from a supplier's payment and deposited it with the Government. It furnished the TDS certificate to the supplier 12 days after the due date for furnishing it. The delay is not attributable to the supplier, and the late fee under section 51 is Rs 100 per day subject to a ceiling. What late fee is payable by the deductor?

The late fee is Rs 1,200. When the deductor fails to furnish the TDS certificate within five days of depositing the tax, the fee is Rs 100 for each day of delay, up to a maximum of Rs 5,000, so 12 days gives Rs 1,200.

  1. ARs 1,200Correct
  2. BRs 5,000
  3. CRs 2,400
  4. DRs 100

Explanation

The certificate must be furnished within five days of crediting the deducted tax to the Government. Failing this, the deductor pays Rs 100 per day of delay, capped at Rs 5,000. For 12 days: 12 x 100 = Rs 1,200, which is below the cap. Rs 5,000 is just the maximum, not the amount for this delay.

Did you get it right without looking?

One question tells you little. A timed set on Tax Deduction at Source and Collection of Tax at Source shows your real accuracy, how long you take and where you lose marks.

Practise Tax Deduction at Source and Collection of Tax at SourceFree diagnostic mock

More Tax Deduction at Source and Collection of Tax at Source questions