Tax audit

This query is : Resolved

KANDHAVADIVEL (Querist)
Follow

20 August 2011 We have prodived liability in 31.03.2011 for contractor bills, at that time we did not know the exact bill amount, hence approximate liability provided for expence only ( No TDS liab). during april we received bill and TDS deducted & paid on 07.05.2011 (with interest) for P.Y. But this entire liability disallowed in tax audit because there was no TDS liab as on 31.03.2011.

Pls let us know whether we have to show TDS liab also in the books to claim the exp in P.Y.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
Follow

20 August 2011 It will be allowed in the current financial year. since you paid TDS this year

KANDHAVADIVEL

KANDHAVADIVEL (Querist)
Follow

22 August 2011 sir, TDS paid for FY: 2010-11 not for c.y:2011-12. pls make correction if any

Upgrade to CAclubindia Pro. Subscribe Now!

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
Follow

22 August 2011 yes. TDS related to 2010-11 only. but you are not deducted that year and paid, if you deduct current year and pay then your expenses will be allowed this year. Or you are not finalized your financials for 2010-11 then you make provision now and pay before filing the Income tax return, then it will be allowed in the 2010-11 year itself