Income Tax Due Date Alert – Equalisation Levy Deposit
As the financial year 2024-25 nears its end, businesses engaged in e-commerce transactions must ensure compliance with the Equalisation Levy. The due date for the Equalisation Levy deposit for the January - March 2025 quarter is 31st March 2025.
Failing to deposit the levy on time may lead to penalties and interest charges, making timely compliance essential.
What is the Equalisation Levy?
The Equalisation Levy is a tax introduced by the Indian government to ensure fair taxation of digital transactions. It applies to non-resident e-commerce operators who provide services to Indian customers.
🔹 Introduced under the Finance Act, 2016, the levy initially applied to digital advertising services.
🔹 Extended in the Finance Act, 2020, it now includes e-commerce transactions such as online sales, services, and digital platform usage.
Who Needs to Pay the Equalisation Levy?
The Equalisation Levy applies to:
✅ Digital advertising services availed from non-resident companies.
✅ E-commerce operators who provide goods or services online.
✅ Foreign businesses earning revenue from Indian users without a physical presence in India.
Rate of Equalisation Levy
📌 6% on digital advertising services provided by non-resident companies.
📌 2% on e-commerce transactions where goods/services are supplied by a non-resident e-commerce operator.
💡 Important:
The Equalisation Levy is NOT applicable if the non-resident has a Permanent Establishment (PE) in India or if the total revenue from Indian transactions is less than ₹2 crores.
Equalisation Levy Compliance & Due Dates
📅 Quarterly Payment Due Dates:
| Period Covered | Due Date |
|---|---|
| April - June | 7th July |
| July - September | 7th October |
| October - December | 7th January |
| January - March | 31st March |
Since March 31, 2025, is the last due date for this financial year, businesses must ensure their tax is deposited to avoid non-compliance penalties.
Consequences of Late Payment
⚠️ Penalty for Non-Payment or Late Payment:
🔸 Interest: 1% per month or part of the month on unpaid levy.
🔸 Penalty: Equal to the amount of levy due, in addition to the original levy.
🔸 Disallowance of expenses: Failure to deposit the Equalisation Levy can lead to disallowance of the expense while computing taxable income under the Income Tax Act.
To avoid unnecessary financial and compliance burdens, ensure timely payment of the levy before March 31, 2025.
How to Pay the Equalisation Levy?
1️⃣ Login to the Income Tax e-filing portal.
2️⃣ Select Challan ITNS 285 for Equalisation Levy payment.
3️⃣ Enter details of the payment and select the appropriate section.
4️⃣ Make the payment through net banking, debit card, or challan deposit at an authorized bank.
5️⃣ Download and save the payment receipt for future reference.
Need Help with Tax Compliance? Contact Taxla Services!
Avoid last-minute hassles and penalties by ensuring accurate and timely Equalisation Levy payments. At Taxla Services, our expert tax professionals provide seamless compliance solutions for all your tax needs.
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