Tds on provision

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 April 2012 Dear sir,

Ours is a MNC Company we made provision for March 2012 Excluding Service Tax Portion. now service Tax portion is Deducted in the Current FY 2012-13 is it Correct?.

some Cases we made Excess & Low provision as compared to Original Invoice Value, we are using SAP software How can we will Adjust Excess & Low Provision amount.

Please suggest me ASAP.

Regards
Sreenatha Reddy

CA Kishore Tallam

CA Kishore Tallam (Expert)
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14 April 2012 Provision is an estimate and hence, it need not be equal to actuals. however, if a provision is made based on a bill, then it has to be correct and TDS has to be deducted eventhough credited to a provision account. Else the expenditure will be disallowed.