Canada imposes Rs 82 lakh penalty on Infosys for underpayment of tax

The Canadian government has fined IT giant Infosys approximately Rs 82 lakh for allegedly failing to fulfil the complete employee health tax obligation for the financial year ending December 31, 2020.

This fine translates to over 134,000 Canadian dollars, according to a recent regulatory filing. "Penalty imposed on alleged underpayment of Employee Health Tax for the year ended December 31, 2020," stated the filing.

Infosys disclosed that it received notification from Canada's Finance Ministry on May 9, informing the company of the penalty. The precise penalty amount specified in the filing is 134,822.38 Canadian dollars.

Infosys has stated that the imposition of the fine will not significantly impact its financials, operations, or other commitments.

In an earlier incident in January, Infosys faced a penalty of $225 for the alleged violation of "short payment of modified business tax" for two quarters by the US taxation authority. Short payment refers to partial or reduced payment made that is lesser than the invoiced amount.

In August last year, the Florida Department of Revenue imposed a similar penalty worth $76.92 for Infosys's tax payment shortfall. Later in October, the Commonwealth of Massachusetts imposed another fine of $1,101.96 on Infosys for rejecting the family and medical paid leave returns for the first and second quarters of 2023.

In September, India's commercial taxes department, specifically from the assistant commissioner of the Kelambakkam assessment circle in Chennai, also sent a demand notice of Rs 26.5 lakh for integrated goods and services tax (IGST), along with penalty and interest charges.