Hello all
This query is : Resolved
10 April 2012
We have paid security deposit to the warehouse owner in 2009. but now we have to adjust the said security deposit with current 3 months rent (S.DP./3) for which we have to deduct the TDS also as the rent is more than the exemption limit. So please your goodself is hereby requested to please tell me about its TDS liabilities and accounting entries.
Thanks & regards
Kaushal
Thanks & regards
Kaushal
10 April 2012
Assuming Rent is Rs. 20,000 p.m and SD is Rs. 60,000.
Rent A/c Dr 20,000
To Vendor A/c 18,000
To TDS Payable Account A/c 2,000
The balance SD left out is Rs. 6,000 which can be paid to the vendor.
Rent A/c Dr 20,000
To Vendor A/c 18,000
To TDS Payable Account A/c 2,000
The balance SD left out is Rs. 6,000 which can be paid to the vendor.
10 April 2012
Assuming Rent is Rs. 20,000 p.m and SD is Rs. 60,000.
Rent A/c Dr 60,000
To Vendor A/c 54,000
To TDS Payable A/c 6,000
Vendor SD A/c Dr 54,000
To Vendor A/c 54,000
The balance Rs. 6,000 can be paid to the vendor.
Rent A/c Dr 60,000
To Vendor A/c 54,000
To TDS Payable A/c 6,000
Vendor SD A/c Dr 54,000
To Vendor A/c 54,000
The balance Rs. 6,000 can be paid to the vendor.
10 April 2012
Dear Kishore Ji,
I think this should be considered as prior period adjustments as the S.D. is paid in 2009 and when the godown is vaccant it should be treated as 3 months rent (suppose in the year 2010-11) but the S.D. is still reflected in our account and at that time no entry was passed for adjusting it with rent. But now we have to settle the account by passing the entries of the rent. So my query is what are the tax liabilities on the same (including intrest) as per I.T. Act.
Thanks & regards
Kaushal
I think this should be considered as prior period adjustments as the S.D. is paid in 2009 and when the godown is vaccant it should be treated as 3 months rent (suppose in the year 2010-11) but the S.D. is still reflected in our account and at that time no entry was passed for adjusting it with rent. But now we have to settle the account by passing the entries of the rent. So my query is what are the tax liabilities on the same (including intrest) as per I.T. Act.
Thanks & regards
Kaushal
10 April 2012
Dear Kishoreji,
By mistake, you have credit vendor A/c twice. it should br credit and debited at second instance and will be wiped out.
The vendor SD A/c will be credited with 54000.
Dear Mr. kaushal,
The amount paid by you in 2009 was towards security deposit and if as per the agreement, the amount was refundable then there was no need to deduct the TDS at that point of time.
Now, If you want to adjust the same with rent for current period then you can deduct the TDS now.
By mistake, you have credit vendor A/c twice. it should br credit and debited at second instance and will be wiped out.
The vendor SD A/c will be credited with 54000.
Dear Mr. kaushal,
The amount paid by you in 2009 was towards security deposit and if as per the agreement, the amount was refundable then there was no need to deduct the TDS at that point of time.
Now, If you want to adjust the same with rent for current period then you can deduct the TDS now.
10 April 2012
If the Security deposit was non refundable i.e adjustable at the time making the payment of such deposit then TDS should have been deducted at that point of time.
10 April 2012
Yep.. Sorry, the second entry should be in reverse way. then the balances will be nullified.
Kushal:
It will not be treated as Prior period since the adjustment transaction itself came into picture in current year.
Kushal:
It will not be treated as Prior period since the adjustment transaction itself came into picture in current year.
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