Income-tax Act Sec 43B(h) · MSMED Act 2006 Sec 15 & 16

MSME 43B(h) & Interest Checker

Is a payment to a micro/small supplier within the Sec 15 time limit? If not — the Sec 43B(h) disallowance and the Sec 16 compound interest on the delay.

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Supplier & invoice

Is the supplier a registered Micro or Small enterprise (has Udyam)? 43B(h) applies only to Micro & Small suppliers of goods/services. Medium enterprises and traders are NOT covered.

Written agreement on the credit period? No agreement → 15 days. Written agreement → the agreed period, but the Act caps the recognised limit at 45 days.

Date of acceptance / invoice

Invoice amount (₹)

Payment status

Date of actual payment

RBI Bank Rate (% p.a.) Sec 16 interest = 3 × bank rate, compounded with monthly rests. Bank rate changes with RBI policy — verify before relying.

Interest rate applied: 16.50% p.a. (3 × bank rate), monthly compounding.

Result

Due date (appointed day)

—

Sec 43B(h) — deduction

—

Delay beyond limit

—

Sec 16 interest (non-deductible)

—

payable to the supplier

Supplier & invoice

Result

How it applies