The due date for deduction is either at the time of giving credit or payment of the dues, whichever is earlier. Late deduction happens in the event the tax is not deducted when the deduction is due and is deducted at a later date. The interest for the delay in deduction is charged at the rate of 1% per month or part of a month of the delay.
For Example, if the due date for a deduction is 2nd of April and it is deducted on the 8th of May in the same year, then the interest is charged at the rate of 1% for each month i.e. (April, May) aggregating to 2% interest.
*Month has not been defined in the Income Tax Act, 1961. However, in a number of High Court cases, it has been mentioned that it should be considered as a period of 30 days and not as an English calendar month.