There are multiple section which provides for Interest, Fees & Penalty under the Income tax Act. Major provisions are outlined below:
| Section 117(1)(Ka) | Failure to file Estimated Tax Return tax payable u/s 95(1): Higher of : (a) Rs. 5,000, or (b) 0.01% of Assessable Income |
| Section 117(1)(Kha) | Failure to file Advance tax Return pursuant to Section 95Ka(5): Shall be liable to pay fee @ 1.5% of base amount for each month and part of a month of delay |
| Section 117(1)(Ga) | Failure to file Income Tax Return u/s 96(1): (1) For the presumptive taxpayer u/s 4(4): Rs. 100 per month (2) For Other Taxpayers: Higher of (a) Rs. 100 per month, or (b) 0.01% of all Inclusions |
| Section 117(2) | Fails to maintain proper books of account u/s 81: Higher of: (a) 0.01% of all inclusions (b) Rs. 1,000 |
| Section 117(3) | Fails to file TDS Return u/s 90(1): Fee @ 2.5% of the tax amount for each month and part of a month during which failure continues |
| Section 118 | Interest for understating Estimated tax payable by Installment: 1. Poush: (Actual tax liability x 90%-Actual Deposit) x 3/12*15% = xxxx 2. Chaitra: (Actual tax liability x 90%-Actual Deposit) x 3/12*15% = xxxx 3. Asadh: (Actual tax liability x 90%-Actual Deposit) x 3/12*15% = xxxx Total xxxx (Note: Interest is not applicable if total tax payable is less than Rs. 7,500) |
| Section 119 | Interest for failure to pay Tax: Interest is payable @ 15% p.a. from expiry of original due date to actual date of payment i.e. payable from the first day of Kartik onwards till actual date of payment (Note: Part of the month is considered as full month) |
| Section 120 | False or misleading statement to department or omission in the Statement made: (a) Sec 120Ka (Bona fide Intention): 50% of underpayment of tax (b) Sec 120Kha (Mala fide Intention): 50% of underpayment of tax |
| Section 120 | Fees for Aiding and abetting: A person knowingly or recklessly aids, abets, counsels, or induces another person to commit offence under this Act is liable to penalty equal to 100% of underpayment of tax. |