13 August 2010
Dear Sir out of Royality payble of Rs:1000000/- per month we have paid Rs:5,00,000/- as on advance is it necessary to deduct TDS for The advance payment please Advise...
TDS is required to be deducted at the time of payment or credit which ever is earlier.
Conclusion
Deduction here depends upon the accounting system. if you shown the above transaction just as an advance ( receivables) then not required to be deduct any TDS at that point of time. Deduct at the time of settlement of the same in to expense
But if you had shown it as an expense then must deduct the TDS and pay the amount.
CAclubindia
