Tds on provision entry of audit fee

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

12 November 2015 Dear experts,
Our auditor has passed provision entry on 31/3/2015, i.e 40000 audit fee and 44944 ST, total 44944/- plz tell me weather TDS will be deduct on this provision entry or not if yes on which amount weather on 40000 or on 44944,

Thanx & Regard
Amit chawla

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

12 November 2015 194 J... deduct tds on 40,000/-

in tds sections try to focus on the sords of the sections.... income versus payment.

income....tds on net amount
payment.... tds on gross amount

Manish Bhandari

Manish Bhandari (Expert)
Follow

12 November 2015 In the absence of contract / agreement it will be on 44,944/- . In case of agreement / contract on 40,000. There is even an circular & judgement for clarification.

Upgrade to CAclubindia Pro. Subscribe Now!

Manish Bhandari

Manish Bhandari (Expert)
Follow

12 November 2015 In the absence of contract / agreement it will be on 44,944/- . In case of agreement / contract on 40,000. There is even an circular & judgement for clarification.

Querist : Anonymous

Querist : Anonymous (Querist)

12 November 2015 Dear both experts, thanx for your prompt reply, plz clarify weather TDS will be deduct or not on provision of audit fees, if yes do i need to credit the auditor name or credit provision for audit fees while passing provision entry, also clarify it will attract in u/s 194J or in 194C, and on which amount weather on 40000 or on 44944/- however NO contract deed was made in respect of audit,

Manish Bhandari

Manish Bhandari (Expert)
Follow

13 November 2015 TDS attracts on credit or payment date whichever is earlier. So provision is also part of credit & covered U/s 194J. It will be on full amount in absence of contract. As far as auditor name is concerned it will better practice if you mention it under provisions.

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

13 November 2015 you need to deduct TDS upfront. (The wording of the section is AT THE TIME OF PAYMENT OR CREDIT......SO? if you make the provision on 31st march, you need to deduct TDS for the financial year