TDS ON REVERSAL OF EXPENSES

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 September 2010 I HAVE HIRE SERVICE FROM CONTACTOR & REVEICED INVOICE VALUE Rs. 50000, I HAVE BOOKED THE BILL AND DEDUCT TDS AS PER RULE, (49000 & 1000 TDS)
AFTER SOME DISCUSSION WITH THE PARTY, AGREE TO ISSUE ME A CREDIT NOTE OF Rs. 10000
PLS. GUIDE ME ABOUT ACCOUNTING ENTRY, SHOULD I REVERSE THE TDS AMOUNT Rs. 200/- DEDUCTED PREVIOUSLY.
ARE CREDIT NOTE RECEIVED IS ENTITLE FOR ADJUSTMENT OF TDS IN FUTURE BILLING

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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16 September 2010 NO, NEED TO REVERSE TDS, IT WILL BE ADJUSTED IN FUTURE TRANSACTION WITH THIS PARTY.
THERE IS ADJUSTMENT CONCEPT IN TDS, NOT REVERSAL.

Querist : Anonymous

Querist : Anonymous (Querist)

16 September 2010 YOU ARE NOT ENTITLE TO REVERSE THE TDS AGT CREDIT NOTE

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CMA. Subhash Kumar Jha

CMA. Subhash Kumar Jha (Expert)
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16 September 2010 If you have not paid the TDS till now, then its simple pay the net TDS i.e Rs. 800/-

But if you have already paid the TDS then as Mr.Bansal said, adjust the excess TDS in future payments of this party within the same quarter.

If both the above are not applicable & you have already paid the TDS of Rs. 1000/- , then let it be as it is. The party will get the benefit of all the TDS deducted as the same will be reflected in the form 16A.

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