Short deduction of TDS-salary

Whether any short deduction of income tax from employees,subsequently a report is generated and send to Employer.

Whether the employer can deduct the short deducted of tds alongwith Interest accrued thereon till the date of deposit say it is after 2014-15 FY and can be deposited before 31-08-2015.

Or the employee will deposit the short deduction with interest before 31-08-2015.

Either any of should deposit before 31-08-2015.

Is there any penalty clause will be imposed on either 1) EMPLOYER or 2) EMPLOYEE.



AKDAS
Asked 1 year ago in Income Tax from Bhubaneswar, Odisha
It is the responsibility of the employer to deduct tax properly and remit the same to the Government. In the case of short deduction, he can make it good and remit the same along with interest. However, it may create a problem if you have already filed your return. If you have not filed the return, then he can remit the short deduction and issue Form No. 16 afresh. 
There is penalty only on the employer and not on the employee. However, if there is reasonable cause for such short deduction, penalty may not be levied. 
B Vijaya Kumar
CA, Hyderabad
290 Answers
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The question is not clear but as far as we understood we give the answer as follows :

The employer can pay the short deducted Income Tax before 31-08-2015 along with interest.
The employer is at liability to deposit the TDS amount. The late fees and interest will be imposed only on Employer.
Shyam Sunder Modani
CA, Hyderabad
955 Answers
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It is not sufficient to deposit deficit amount of tax with interest but also file TDS return immediately to get credit for TDS In your account.

Alternatively, you can pay deficit tax without interest as self assessment tax and claim the same in your return of Income.

Penal action is against employer as he has failed in discharge of his obligation under Income Tax Act.
Vijay N. Kale
CA, Hyderabad
248 Answers
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The liability to deduct the TDS on the salary  lies with employer and if there is any delay or interest thereon it should be on employer only .  However in case of delay the employer in order to take the deduction of the expenditure of the salary  in computing the tax under the business & profession ( of the employer ) he can pay the tax on or before the due date ( Due date for employer is generally 30/09 or 30/11) . Hence the due of filling of return for the salaried employee ( 31/08)  has nothing to do with this case .
Now when an employee is paying the  tax on filling the return on or before 31/08 , he has to pay the taxes . Further in case of delay in payment of tax , there is the liability of interest also . Ideally the interest should not be there if the employer would be deducted the correct tax and paid on time . Thus the liability to pay the interest is on account of non fulfillment of statuary duty from the employer side 
Here the employer is  the assessee in default and  penalty impose able .if any should be on employer and not employee .
Prakash Sinha
CA, Delhi
112 Answers
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