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TDS Interest Calculator (Late Deduction & Deposit)
Deducted TDS late, deposited a challan after the due date, or filed the quarterly return behind schedule? Work out the Section 201(1A) interest and Section 234E fee before you pay through Challan ITNS 281.
Reviewed by the CalcCafe editorial team · Last updated 18 July 2026 · How we test our tools
Example
Say you deducted TDS of ₹50,000 on time (0 months of deduction delay) but deposited it 3 months late, and filed the quarterly return on time (0 days). Interest on the late deposit is 50,000 × 1.5% × 3 = ₹2,250. There is no late-deduction interest and no Section 234E fee, so the total extra payable through Challan ITNS 281 is ₹2,250 — on top of the ₹50,000 TDS itself.
How it works
Section 201(1A) prescribes two separate simple-interest charges. For late deduction: 1% per month or part of a month, from the date the tax was deductible to the date it was actually deducted. For late deposit: 1.5% per month or part of a month, from the date of deduction to the date of payment to the government. On top of that, Section 234E levies a fee of ₹200 per day for late filing of the quarterly TDS statement, capped at the TDS amount in that statement. Total = late-deduction interest + late-deposit interest + filing fee. Round any part month up to a full month before entering it.
Good to know
The phrase “month or part of a month” in Section 201(1A) is what makes TDS interest sting: it is not pro-rated by days. If tax was deducted on 25 March and deposited on 2 May, the delay touches parts of three calendar months and attracts 1.5% × 3 = 4.5%, even though only about five weeks elapsed. Always round up when entering the months of delay — that is exactly how the TRACES system and assessing officers compute the demand.
Deposit due dates drive the deposit-delay count. TDS deducted in any month must normally be deposited by the 7th of the following month; the big exception is March, for which non-government deductors get until 30 April. Government deductors and special cases like Section 194-IA property TDS (30 days from month-end, via Form 26QB) follow their own timelines. Note a quirk of the 1.5% clock: it runs from the date of deduction, not from the due date, so even a short slip past the 7th can effectively cost two months of interest.
Payment is made through Challan ITNS 281 — now an online flow under “e-Pay Tax” on the income-tax e-filing portal (the older OLTAS/Protean-NSDL TIN system routes there too). In the challan you quote your TAN, pick the deductee type and section code, choose type of payment 200 (regular TDS) or 400 (payment against a demand), and fill the separate fields for interest and fee — 201(1A) interest and the 234E fee must go in their own columns, not merged into the tax amount, or the TRACES reconciliation will still show a default.
The quarterly TDS statements — Form 24Q for salaries and Form 26Q for other resident payments — are due on 31 July, 31 October, 31 January and 31 May for the four quarters. Filing late triggers the ₹200/day fee under Section 234E (capped at the TDS deducted), and a delay beyond one year, or incorrect particulars, can additionally attract a penalty of ₹10,000 to ₹1,00,000 under Section 271H. Separately, failing to deduct or deposit can lead to disallowance of the expense under Section 40(a)(ia) and, in serious deposit-default cases, prosecution under Section 276B — so the interest figures here are the mildest layer of the consequences.
Frequently asked questions
What are the interest rates for late deduction and late deposit of TDS?
Late deduction costs 1% per month or part of a month, from the date the tax was deductible to the date it was deducted, under Section 201(1A)(i). Late deposit costs 1.5% per month or part of a month, from the date of deduction to the date of deposit, under Section 201(1A)(ii). Both are simple interest on the TDS amount.
How do I count a partial month of delay?
Round it up. The law charges interest for every month or part of a month, so a delay of one month and one day counts as two months. Count the calendar months touched by the delay period and enter that number.
Do my figures leave my device?
No, this calculator runs entirely in your browser. Nothing you type is uploaded, and the page keeps working offline once loaded.
Is this calculator free to use?
Yes, completely free with no sign-up. It provides an educational estimate; verify the final demand on TRACES or with your tax professional before paying.
People also ask
What is Challan ITNS 281 used for?
Challan ITNS 281 is the challan for depositing TDS and TCS with the government. You pay it online through the e-Pay Tax facility on the income-tax e-filing portal, quoting your TAN, choosing company or non-company deductees, the section code, and entering tax, interest and the 234E fee in their separate fields.
What is the maximum late filing fee under Section 234E?
The fee accrues at 200 rupees per day of delay but cannot exceed the amount of TDS in that quarterly statement. So for a statement with 50,000 rupees of TDS, the fee stops growing once the delay reaches 250 days.
When is TDS required to be deposited with the government?
For non-government deductors, TDS deducted in a month is due by the 7th of the next month, except TDS for March, which is due by 30 April. Property TDS under Section 194-IA is due within 30 days of the month-end via Form 26QB. Missing these dates triggers 1.5% per month interest from the deduction date.
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Sources & references
These tools follow our methodology and provide educational estimates only — verify important figures with a qualified professional.