TDS Recoverable
This query is : Resolved
16 June 2008
Nature of Tds recoverable amount?
How this account is finally settled?
How this account is finally settled?
16 June 2008
Hi Gaurav,
TDS Recoverable amount is in the nature of Advance. Since we adjust this TDS Recoverable on our Income Tax liability, this amount is treated as Advances or other advances in Balance sheet.
Industry practice is to name this account along with the F.Y.
For Eg:- TDS Recoverable A/c 2008-09
TDS Recoverable A/c 2007-08...
These accounts remain as advance until that F.Y. assessment order is received from Income Tax.
For Eg: 2008-09 F.Y.
Tax Liability calculated is Rs.15000/-
TDS Recoverable A/c 2008-09 is Rs. 4000/-
TAX payable is Rs.11000/- as CASH
TDS recoverable i treat it has tax paid already, hence deducted from Tax liability to calculate TAX Payable
At the end of the year-----2008-09
Balance sheet shows...Provision for Liablity as Rs.15000/- and TDS Reco as Rs.4000/-
In the next year--------2009-10
(since balance sheet is closed, tax payment happens next year)
Rs.11000/- is paid and Debited to Self Assessment Tax Paid A/c. (Treated as Advance A/c)
After one year----------2010-11
When the assessment order is received. AO confirms this amounts and passes the order.
It means he has accepted the TDS recoverable amount without any issues. So, TDS which we treated as advance has helped us from settling our tax liability of 2008-09 year.
Entry will be----
DEBIT Provision for Tax Rs.15000/-
CREDIT TDS Recoverable (2008-09) Rs.4000/-
CREDIT Self Assessment Tax Paid Rs.11000/-
As you can see, all the accounts gets knocked off....
This is done because, unless Assessing Officer issues Assessment Order...our liability or TDS amount is not confirmed. That is why, it is kept alive until the receipt of order.
Hope this clarifies your doubt
Regards,
guru
TDS Recoverable amount is in the nature of Advance. Since we adjust this TDS Recoverable on our Income Tax liability, this amount is treated as Advances or other advances in Balance sheet.
Industry practice is to name this account along with the F.Y.
For Eg:- TDS Recoverable A/c 2008-09
TDS Recoverable A/c 2007-08...
These accounts remain as advance until that F.Y. assessment order is received from Income Tax.
For Eg: 2008-09 F.Y.
Tax Liability calculated is Rs.15000/-
TDS Recoverable A/c 2008-09 is Rs. 4000/-
TAX payable is Rs.11000/- as CASH
TDS recoverable i treat it has tax paid already, hence deducted from Tax liability to calculate TAX Payable
At the end of the year-----2008-09
Balance sheet shows...Provision for Liablity as Rs.15000/- and TDS Reco as Rs.4000/-
In the next year--------2009-10
(since balance sheet is closed, tax payment happens next year)
Rs.11000/- is paid and Debited to Self Assessment Tax Paid A/c. (Treated as Advance A/c)
After one year----------2010-11
When the assessment order is received. AO confirms this amounts and passes the order.
It means he has accepted the TDS recoverable amount without any issues. So, TDS which we treated as advance has helped us from settling our tax liability of 2008-09 year.
Entry will be----
DEBIT Provision for Tax Rs.15000/-
CREDIT TDS Recoverable (2008-09) Rs.4000/-
CREDIT Self Assessment Tax Paid Rs.11000/-
As you can see, all the accounts gets knocked off....
This is done because, unless Assessing Officer issues Assessment Order...our liability or TDS amount is not confirmed. That is why, it is kept alive until the receipt of order.
Hope this clarifies your doubt
Regards,
guru
Message likes :
1 times
16 June 2008
Reply me if you are ok or not ok.
Message likes :
1 times
17 June 2008
Mr. Guru Santhanam
UR answer to the above question is very clear, Thanks
UR answer to the above question is very clear, Thanks
17 June 2008
The concept is clarified clearly.
Thanks for the prompt reply.
Thanks for the prompt reply.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- REGARDING GST ON COMMERICIAL PROPERTY
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- GST on export of services and Input Credit
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- ITC temporary reversal and reclaim
- TDS U/S. 194NF
- Applicable TDS rate for sale of property in Nov 2024
- REGARDING 25 AS DATE OF PAYMENT AND DATE OF BOOKING
- Long term Capital gains received on sale of Residential Plot of land 10 years after buying it
- RCM INVOICING FROM NOV-2024
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
Trending Online Classes
CAclubindia
