Tds and receipt in diffrnt year
This query is : Resolved
30 September 2011
I receive a cheque from party, in year April, 11-12, which was receivable in 11-12 itself.
But party issued cheque in 10-11 march, and deposit the TDS in 10-11.(as per form 16A issued by party)...
Now , as my accounting policy i shall book income in 11-12, and claim TDS on same in 11-12.
but that is in conflict with income tax computation..!!!
I receive a cheque from party, in year April, 11-12, which was receivable in 11-12 itself.
But party issued cheque in 10-11 march, and deposit the TDS in 10-11.(as per form 16A issued by party)...
Now , as my accounting policy i shall book income in 11-12, and claim TDS on same in 11-12.
but that is in conflict with income tax computation..!!!
01 October 2011
In March 2010-11, book the receipt as advance received and claim tds .
in yr 11-12 you can book expense.
in yr 11-12 you can book expense.
02 October 2011
If you have received cheque in April'2011 then you can claim TDS in 2011-12 even that person has deducted and shown in the year 2010-11
02 October 2011
in that case you have no option but to book invoice/expense in previous year
02 October 2011
Thanks, I would like to add that in form 26 AS, its is showing that TDS creidit in 2010-11, but as i receive income in 11-12, and also as per my accounting policy , i should account in 11-12, Hence there is conflict..
I am confused.. !!!!
I am confused.. !!!!
03 October 2011
Your accounting policy??? Do you follow cash accounting.
Normally, income is booked when the goods are sold or services are provided.
You should have booked the income when you sold the goods or provided the services.
Also, from your client's point of view TDS is required to be deducted when the expense is booked. He will deduct TDS & deposit the same when he receives your bill. If you book the income at the time of receipt, there will always be difference between your books and income tax records.
It is advisable to book income on due basis. SO you should book income in the previous year and claim the TDS deducted thereon in the previous year itself.
Normally, income is booked when the goods are sold or services are provided.
You should have booked the income when you sold the goods or provided the services.
Also, from your client's point of view TDS is required to be deducted when the expense is booked. He will deduct TDS & deposit the same when he receives your bill. If you book the income at the time of receipt, there will always be difference between your books and income tax records.
It is advisable to book income on due basis. SO you should book income in the previous year and claim the TDS deducted thereon in the previous year itself.
03 October 2011
the other option is you ask customer to file a revised return for tds 10-11, without your tds deduction. and then ask him to deduct in 11-12.
03 October 2011
@ Siddharh ji,
IN case of advance received, as party shall pay only after TDS, TDS shall be deducted on payment only,
BUT income shall be recogised, only when there is delivery of service/goods.
Hence,TDS in my credit is credit in standing in 10-11, but i shall recognise income when there is delivery of service..which is 11-12 in compliance with AS-9.
Please take this into light.
@ achalagarwal :- why should party revise his TDS return, is he wrong ..??
@ Siddharh ji,
IN case of advance received, as party shall pay only after TDS, TDS shall be deducted on payment only,
BUT income shall be recogised, only when there is delivery of service/goods.
Hence,TDS in my credit is credit in standing in 10-11, but i shall recognise income when there is delivery of service..which is 11-12 in compliance with AS-9.
Please take this into light.
@ achalagarwal :- why should party revise his TDS return, is he wrong ..??
03 October 2011
You did not mention in the query that there was an advance payment.
If that is the case, then you will show the advance in the year 2010-11 and claim the TDS.
You will book the income in the year 2011-12.
Hope now it is clear.
If that is the case, then you will show the advance in the year 2010-11 and claim the TDS.
You will book the income in the year 2011-12.
Hope now it is clear.
04 October 2011
i agree , i have mentioned the same thing at first...
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