Tds

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

05 December 2015 Dear expert,
As per 194C tds is paid whether amount credited or payment whichever is earlier.The amount Rs 1000000/- is advance paid to the party where 1% rate is applicable and during the tds deposit whether it should be assumed it as the net amount and doing accordigly of Rs 10101/-or considered this amount as the gross amount of tds and deposit accordingly of Rs 10000/-i.e.
And similary if 980000 is the bill on the date before payment what be the consequences?Please help me.

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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05 December 2015 You need to deduct TDS on Rs 1000000/-

i.e., Rs 10000/-

If final bill is Rs 980000/- then adjust the excess TDS in next bill.

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Querist : Anonymous

Querist : Anonymous (Querist)

05 December 2015 Sanjay ji
what will be adjustment entry for the same

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CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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05 December 2015 1) Advances Dr.....Rs 1000000
To TDS Payable Rs 100000
To Bank Rs 900000

2) Expenses Dr Rs 980000
Bank Dr Rs 200000
To Advance Rs 100000

From next bill you will deduct Rs 2000 TDS less.

Say Rs 100000 bill so deduct TDS Rs 8000 and in return show that excess 2000 so that total TDS will be Rs 10000

Nikhil Kaushik

Nikhil Kaushik (Expert)
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06 December 2015 actually if the cash transferred to the party is Rs 1000000, then you have to assume that this amount was net of taxes, therefore, TDS amount would be Rs 10101 only.

The entry should be something like this:

Party A/c Rs 10 1010101
To TDS Payable Rs 10101
To Bank 1000000