13 August 2011
M/s XYZ makes payment to its lawyers after deducting TDS, but M/s XYZ pays the whole amount including TDS to the Lawyers and afterwards it pays the TDS to the Government from its own pocket. Thus, there remains a Debit balance in the Name of the lawyer in the books of M/s XYZ. If we write off such Dr. balance,then is it right to add back the TDS to the Net Profit for calculating the Taxable Business Income?
14 August 2011
You have to debit the TDS to the account of the lawyer and send him a letter to pay the same as he has already been paid 100% and the TDS has also been deposited by the company. If he does not pay it then keep it debited and from the next bill deduct this amount and pay the balance.
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