Interest on delayed payment of tax – Section 50 of CGST, 2017
By: – CA.VINOD CHAURASIA
Goods and Services Tax – GST
Dated:- 26-9-2017
Introduction: This article discusses in detail about interest payable on late payment of tax liability under GST.
Every person who is liable to pay tax under GST fails to pay the tax or any part thereof to the Government within the due date then he shall pay on his own, interest at 18% or 24% P.A. on outstanding tax liability.
Further, the interest shall be calculated from the day succeeding the day on which such tax was due to be paid.
Vide notification no 13/2017 – Central Tax dated 28th June 2017, interest rate on late payment of GST under section 50 of CGST Act as below:
* Interest
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ys default (31 days, we shall not count 20th may)
* Outstanding tax (Which is ₹ 10 lakh)
Hence, interest on late payment of tax will be ₹ 15,287/- (10 lakh*18%*31/365).
Example -2
Suppose for month of July
Output GST=100000
Input GST=80000
GST payable=20000
This 20000 we have to pay by 20 August (20 of Next Month)
In case we pay the same on 24 August, we are 4 days late
Interest will be calculated as follows
=20000*4/365*18%=39.45
Interest will be rounded off to 39
Total amount payable =20000+39=20039
The author is a practising CA based in Delhi and is registered Insolvency Professional. He can be reached at cavinodchaurasia@gmail.com , Mob. +91 9953587496.
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