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Interest for deferment in instalments of Advance Tax - Section 234C - Income Tax - Ready Reckoner - Income TaxExtract Interest for deferment in instalments of Advance Tax - Section 234C Where in any financial year - (a) An assessee, other than an eligible assessee in respect of the eligible business referred u/s 44AD , who is liable to pay advance tax under section 208 has failed to pay such tax or has made late payment of advance tax, then asessee shall pay the interest u/s 234C as under:- Circumstances in which interest is payable u/s 234C Rate of interest Period Amount on which interest is to be paid When advance tax paid on or before 15th June is less than 15% of tax due on returned income Simple interest @ 1% p.m. 3 months 15% of tax due on returned income minus advance tax paid upto 15th June When advance tax paid on or before 15th September is less than 45% of tax due on returned income Simple interest @ 1% p.m. 3 months 45% of tax due on returned income minus advance tax paid upto 15th September When advance tax paid on or before 15th December is less than 75% of tax due on returned income Simple interest @ 1% p.m. 3 months 75% of tax due on returned income minus advance tax paid upto 15th December When advance tax paid on or before 15th March is less than 100% of tax due on returned income Simple interest @ 1% p.m. 1 month 100% of tax due on returned income minus advance tax paid upto 15th March However, if the advance tax paid by the assessee on the current income, on or before the 15th day of June or the 15th day of September, is not less than 12% or, as the case may be, 36% of the tax due on the returned income, then, the assessee shall not be liable to pay any interest on the amount of the shortfall on those dates. (b) An assessee who declares profits and gains u/s 44AD(1) or u/s 44ADA (1) and who is liable to pay advance tax under section 208 has failed to pay such tax or the advance tax paid by the assessee on its current income on or before the 15th day of March is less than the tax due on the returned income, then, the assessee shall be liable to pay interest @1% on the amount of the shortfall from the tax due on the returned income Provided that nothing contained in this sub-section shall apply to any shortfall in the payment of the tax due on the returned income where such shortfall is on account of under-estimate or failure to estimate- ( a ) the amount of capital gains; or ( b ) income of the nature referred u/s 2(24)(ix) or, (c) income under the head Profits and gains of business or profession in cases where the income accrues or arises under the said head for the first time or (d) income of the nature referred to u/s 115BBDA(1) - Dividend Income Note: Tax due on Returned Income means Tax on total income declared in ROI XX Less : Any relief of tax allowed under section 89 (XX) Relief of tax u/s 90 / 90A (XX) Relief of tax u/s 91 (XX) AMT credit under section 115JD (XX) TDS/TCS (XX) Tax due on Returned Income XX
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