Section 50 of CGST Act
Interest on delayed payment of tax
Two Situations when interest is payable
When Tax Payable, not paid
(1) Every person who is liable to pay tax in accordance with the provisions of this
Act or the rules, but fails to pay the tax or any part thereof to the Govt. within the period prescribed, shall for the period for which the tax or any part thereof remains
unpaid, pay, *on his own*, interest at such rate, not exceeding eighteen per cent.
PRESCRIBED RATE IS 18% VIDE Notification No. 13/2017 – Central Tax
28th June, 2017
Excess ITC taken or Excess Output Reduced
(3) A taxable person who makes an undue or excess claim of ITC or undue or excess reduction in output tax liability, shall pay interest on such undue or excess claim or on such
undue or excess reduction, as the case may be, at such rate not exceeding twenty-four percent.
PRESCRIBED RATE IS 24%
VIDE Notification No. 13/2017 – Central Tax
28th June, 2017
Method of Calculating Interest
(2) The interest under sub-section (1) shall be calculated from the day succeeding the day on which such tax was due to be paid.
Leave a Reply