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TDS at credit

Satarupa Chakraborty (service) (21 Points)

03 July 2017

When a domestic company has claimed TDS at credit in a single Assessment Year but corresponding income of such company has been offered for taxation over three Assessment Years, what is the correct method of giving credit for TDS?

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8 Replies

Giridhar S Karandikar (Team Lead) (7543 Points)
Replied 03 July 2017

since company is mandatorily required to follow mercantile system of accounting. so when income is offered for taxation on accrual basis though the receipt of such income is realized in subsequent fy, hence credit of TDS can be claimed on accrual basis
what do you mean by offered for taxation in three ay

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Satarupa Chakraborty (service) (21 Points)
Replied 03 July 2017

this question i saw in our previous paper of departmental exam.. i m a tax assistant .. not from commerce background... i m confused in this question what it actually means ?

Poltu Ghosh (Job) (1865 Points)
Replied 03 July 2017

Explain your query with a numerical example. Suppose a company has received Rs 300000 rent in Advance from tenant in FY 2017-18. Annual rent is Rs.100000 . The tenant deducted TDS for Rs. 30000 in FY 2017-18. Now the company has offered rental income of Rs 100000 in FY 17-18. Since only one third of amount on which tax was deducted is shown as Income you shall allow only Rs. 10000 as tds credit in FY 17-18. I.e. credit is allowed to the extent of income offered. Remaining 20000 will be allowed in next two years when the remaining income of Rs 200000 will be offered to tax.