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Tax Deducted at Source: Quarterly payment of TDS could be a ‘Saviour’ for taxpayers in Corona crisis

Tax Deducted at Source: Quarterly payment of TDS could be a ‘Saviour’ for taxpayers in Corona crisis

The government has provided certain relaxation in lockdown 4.0 but sectors that depend on human resources shall take time to recover. From small businesses to corporates, malls and cinemas, every segment is facing heat of this prolonged lockdown in the country due to the global pandemic.

The Finance Minister has announced certain relaxations in terms of reduced rate of interest for tax payments which are due for payment from 20-03-2020 to 29-06-2020 from 1.5% to 0.75% for every month or part thereof if it is paid on or before 30-06-2020. Further, in the press conference held on May 13, 2020, the Finance Minister has also reduced the rates of TDS/TCS in respect of specified payments/receipts by 25%.

In general, the tax deducted between April to February has to be deposited on or before 7th day of the next month and for March it has to be deposited by 30th April. The Finance Minister hasn’t provided any relief in the due date of tax payments. If the deductor fails to deposit tax at source, he shall be liable to pay interest at the rate of 1.5% for every month or part thereof on the amount of tax he failed to deposit to the credit of the Central Govt. The interest shall be calculated for the period starting from the date on which tax is deducted and ending on the date on which such tax is deposited.

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