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Methodology, assumptions and sources

Scope: Computes interest on delayed GST tax payment under Section 50 of the CGST Act.

Calculation logic

1. Interest = Tax amount paid late × 18% per annum (or 24% per annum for the specific case of ITC wrongly availed and utilised, per the proviso) × (Number of days delayed ÷ 365).
2. Interest is computed on the net tax liability payable via the electronic cash ledger (after ITC set-off), consistent with the current interpretation of Section 50(1) as clarified by CBIC circular, from the day after the due date until the date of actual payment.
3. Where the case involves wrongly availed and utilised ITC, apply the higher 24% rate specifically to that portion, per Section 50(3), while the remaining (non-ITC-related) shortfall continues at 18%.

Inputs and assumptions

• 18%/24% rates follow the currently prescribed rates under Section 50 and its proviso; the 18% general rate applies to delayed payment of tax, while 24% is specific to wrongly availed and utilised ITC.
• 'Wrongly availed but not utilised' ITC (i.e., reversed before use) does not attract interest under the current framework, which the calculator reflects by asking the user to confirm whether the ITC was actually utilised.

Exclusions and edge cases

• This is an estimation tool for planning purposes; the GST portal's own system-computed interest at the time of payment/return filing is the authoritative figure for actual liability.
• Does not compute the separate late-filing fee under Section 47 — see the GST Late Fee Calculator or the combined Late Fee and Interest Estimator for that.

Sources

• Goods and Services Tax portal

Review status: reviewed and approved by CA Nikhil Gupta on 19 July 2026.