24 May 2010
I have received a bill of lease rent on fibre cable for rs. 30 lacs for the period from 01.01.2010 to 31.12.2011 & I have enter the bill in my books with prepaid expenses for 9 months, now i want to now my liability to deduct tds on on Rs. 30 lacs or Rs. 7.5 lacs as on 31.03.2010 and what is the tds rate,if we deduct the tds on Rs. 30.00 lacs and claim the exps. Rs. 22.5lacs in next year by transfering the balance from prepaid exps. can the I dept. can ask to deduct the tds on expenses treated Rs. 22.5 in the next year.
24 May 2010
TDS is to be deducted on payment or credit, which ever is earlier.
The event to deduct TDS arises on crediting the bill. Recognition of revenue, either in the year of credit or in later year(s) is not relevant. You have to deduct TDS on 30 Lacs on the date of credit/entry.
The transaction appear to fall under section 194I. The rate is 2% wef 01.10.09.
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