Notification No. 13/2017 – Central Tax Explained

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Notification No. 13/2017 – Central Tax: Seeks to prescribe rate of interest under CGST Act, 2017

GST: [TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

G.S.R. (E).—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.

Table

Serial Number	Section	Rate of interest (in per cent)
(1)	(2)	(3)
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	6
5.	proviso to section 56	9

2. This notification shall come into force from the 1^st day of July, 2017.

(Dr. Sree Parvathy S.L.)
Under Secretary to the
Government of India

📚 Frequently Asked Questions (FAQs): Notification No. 13/2017 – Central Tax

Q1: What is GST interest rate for late payment?

18% per annum.
It applies when GST is not paid on time. The interest is calculated daily until payment is made.

Q2: What is interest on wrong ITC?

24% per annum.
This applies when ITC is wrongly claimed or utilized. It is higher to discourage misuse.

Q3: Is interest automatic in GST?

Yes.
You don’t need a notice. Interest liability arises automatically when there is delay.

Q4: How is GST interest calculated?

Daily basis.
Interest = Tax × Rate × Days/365.

Q5: What is refund interest rate?

6% normally.
It increases to 9% in litigation cases.

Q6: Do I need to pay interest manually?

Yes.
You must calculate and pay it yourself.

Q7: Is interest same as late fee?

No.
Interest is on tax amount; late fee is for delay in filing.

Q8: What happens if I don’t pay interest?

Future demand may arise.
Department can issue notice later.

Q9: Does interest apply on gross or net tax?

Depends on case.
Later clarifications allow net liability in many cases.

Q10: Can interest be waived?

Generally no.
Only through specific notifications or relief.

Q11: Is this applicable to small businesses?

Yes.
Applies to all registered taxpayers.

Q12: Should I take help for calculation?

Recommended.
Many businesses prefer experts:
https://finodha.in/gst-compliance/

Q13: What section governs GST interest?

Section 50 of CGST Act.

Q14: From when is interest applicable?

From due date.
Not from notice date.

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