Interest on delayed payment of tax under GST

Posted on 20 April 2023 Category : GST terms

What is Interest on delayed payment of tax under GST

The details about Interest on delayed payment of tax under GST are explained here.

Interest on delayed payment of tax

Every person who is liable to pay tax in accordance with the provisions of this Act or the rules made thereunder, but fails to pay the tax or any part thereof to the Government 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., as may be notified by the Government on the recommendations of the Council.

The interest under sub-section (1) shall be calculated, in such manner as may be prescribed, from the day succeeding the day on which such tax was due to be paid.

A taxable person who makes an undue or excess claim of input tax credit under sub- section (10) of section 42 or undue or excess reduction in output tax liability under sub- section (10) of section 43, 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 per cent., as may be notified by the Government on the recommendations of the Council.

In exercise of the powers conferred by sub-sections (1) and (3) of section 50, sub-section (12) of section 54 and section 56 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby fixes the rate of interest per annum, for the purposes of the sections as specified in column (2) of the Table below, as mentioned in the corresponding entry in column (3) of the said

Table

Serial Number	Section	Rate of Interest (in per cent)
1	Sub-section (1) of section 50	18
2	sub-section (3) of section 50	24
3	sub-section (12) of section 54	6
4	section 56	9
5	proviso to section 56	9

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