TDS due dates and penalties every SMB should know
TDS has three separate penalties for three separate slips — late deduction, late deposit and late return. Here's what each costs and when payments are due.
27 May 2026 · ComplianceStack
Three slips, three penalties
TDS trips up more SMBs than almost any other obligation, because there isn't one deadline — there are three points where you can slip, each with its own charge:
- Late deduction — you deducted the tax later than you should have.
- Late deposit — you deducted on time but paid the government late.
- Late return — you filed the quarterly TDS return after its due date.
The due dates
- Monthly deposit: TDS deducted in a month is generally due by the 7th of the next month (March has a separate date).
- Quarterly return: the TDS return (Form 24Q for salary, 26Q for other resident payments) is due roughly a month after the quarter ends — 31 July, 31 October, 31 January, and 31 May for the four quarters.
You can confirm any of these with the due-date checker.
What each slip costs
Late deduction — section 201(1A): 1% per month (or part of a month) from the date the tax was deductible to the date it was actually deducted.
Late deposit — section 201(1A): 1.5% per month (or part) from the date of deduction to the date of deposit. Note the word "part" — even one day into a new month counts as a whole month.
Late return — section 234E: ₹200 per day until you file, capped at the amount of TDS in that return.
A worked example
On ₹50,000 of TDS deposited 40 days late (two part-months at 1.5% = ₹1,500) with the return filed 15 days late (₹200 × 15 = ₹3,000), the total interest and fee comes to about ₹4,500 — on a single ₹50,000 deduction.
Run your own figures with the TDS interest & late-fee calculator.
Why it adds up quietly
TDS penalties feel small per transaction, but they accrue across every payment, every month, on a "part of a month counts as a full month" basis. A few weeks of drift across a quarter's deductions can become a real number.
Keeping TDS clean
Track each monthly deposit and each quarterly return with its own due date and owner, and attach the challan and return as evidence. ComplianceStack does this across your whole compliance picture — TDS sits on the same calendar as GST, PF/ESI and ROC, so nothing falls between the cracks.
This is general information, not tax advice — confirm rates and dates for your case with your CA.
FAQs
- When is TDS payment due?
- For most deductors, TDS deducted in a month must be deposited by the 7th of the following month. (March has a special date.) The quarterly TDS return is due about a month after the quarter ends.
- What is the interest for late deposit of TDS?
- 1.5% per month (or part of a month) from the date of deduction to the date of deposit, under section 201(1A).
- What is the section 234E fee?
- A late-filing fee of ₹200 per day for filing the TDS return after the due date, capped at the total TDS amount for that return.
- What happens if I don't deduct TDS at all?
- Besides interest for late deduction, you can face disallowance of the related expense and be treated as an assessee-in-default. Deduct correctly and on time, and confirm grey areas with your CA.
This article is general information, not tax, legal or accounting advice. Statutory timelines and thresholds change by notification — confirm applicability and interpretation with your CA, CS, or lawyer before acting.
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