TDS

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meenakshi (Querist)
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23 July 2009 Can TDS Receivable Account have a credit balance. this is in respect of certificates issued to the assessee.

AJAY KUMAR GUPTA

AJAY KUMAR GUPTA (Expert)
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24 July 2009 TDS recivable by nature indicates an amount of tax paid on our behalf by deductor. Tha amount of tax deducted may be more than our tax liability. Hence accounting is done by Debiting TDS Receivable & Crediting Deductors a/c.
Normally a TDS Recivable may not have a credit balance. A credit balance may emerge, if complete accounting is not done. For example, TDS deducted Rs.100/-, tax liability is Rs.50/-. Now balance Rs.50/- is refunded by ITO including an interest of Rs.10/-. An accounting in respect of interest Rs.10/- is called for. Unless this accounting is completed, Rs.10/- will become a credit balance in TDS receivable a/c.