TDS ON PROVISION

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

29 April 2011 I MADE PROVISION ENTRY OF LEGAL AND PROFESSION OF RS.75000/- TO OUTSTANDING LIABILITY. IT IS NECESSARY TO MADE THE PROVISION OF TDS @ 10%ON THE ABOVE ENTRY?

DR LEGAL & PROFESSIONAL 75000/-
CR OUTSTANDING LIABILITY 75000/-

CA Navin Jain

CA Navin Jain (Expert)
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29 April 2011 YES, ITS MANDATORY TO DEDUCT TDS ON PROVISION ENTRY.

DR LEGAL & PROFESSIONAL 75000/-
CR OUTSTANDING LIABILITY 67500/-
CR TDS PAYABLE -7500

Guest

Guest (Expert)

29 April 2011
Tax needs to be deducted on Credit or Payment basis whichever is earlier.
You should deduct Tax at 10% on Credit basis.

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CMA. Subhash Kumar Jha

CMA. Subhash Kumar Jha (Expert)
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29 April 2011 Tax must be deducted at the time of payment in cash or cheque or credit to the payee's account whichever is earlier. Credit to payable account or suspense account is also considered to be credit to payee's account and TDS must be made at the time of such credit.