Payment to contractor for labour

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 October 2012 can anybody help me about following situation.

in our industry we have total 600 labours. out of 500 labour are contractual labour means we give wages and salary to one contractor whose provide manpower to us, means if we pay wages and salary to manpower contractor directly, so what is accounting entry would be done.

so how is accounting would be done according to standards.

Hemant Kumar

Hemant Kumar (Expert)
Follow

08 October 2012 As per your given information regarding contractor(Manpower), you have to deduct tds u/s. 194C.
Accounting entry would be as follows:

1) Wages ac dr
to Contractrs payable ac.
to tds payable ac.

2) Contractors ac.
to cash/bank ac.