TDS DETECTED FOR CONRACTUAL PAYMENTS U/S 194 C FOR JOB WORK DONE IN APR TO FEB 2009, BUT TAX NOT YET DEPOSITED . IF I PAY DEPOSIT NOW CAN I CLAIM THIS EXPENSES AS EXPENTIDURE?..
gokularamanan (pcc student) (32 Points)
26 August 2009TDS DETECTED FOR CONRACTUAL PAYMENTS U/S 194 C FOR JOB WORK DONE IN APR TO FEB 2009, BUT TAX NOT YET DEPOSITED . IF I PAY DEPOSIT NOW CAN I CLAIM THIS EXPENSES AS EXPENTIDURE?..
sumit bhatia
(ca-final article)
(368 Points)
Replied 26 August 2009
as per sec 43B if you deposit it before due date u can claim as expence
Ram Avtar Singh
(Nagari Sultanpur U.P.Delhi)
(14487 Points)
Replied 26 August 2009
Good News for all of us.While passing the finance bill 2008 as provision relating to section 40(a)(ia) has been amend to give us relief from minor tds deduction defaults from retrospective effect from assessment year 2005-06 means since inception of this controversial amendments.
as per section 40(a)(ia) all the expenses u/s 30-38 will be disallowed if
on
to a resident contractor/sub-contractor
provided that
then expenditure will be allowed in the year of payment of tds.
Tax is deductible but not deducted
Tax is deductible (and is so deducted) during the last month (i.e., in the month of March) of the previous year but it is not deposited on or before the due date of submission of return of income under section 139(1)
Tax is deductible (and is so deducted) during any month but other than the last month (i.e., any time before March 1) of the previous year but it is not deposited on or before March 31 of the previous year
though some relief has been given that in case we pay tds on or before due date of filing of the income tax return expenditure will be allowed in the same previous year but in case of non deduction of the tds when it is deductible then expenditure will be disallowed fully.
suppose xyz ltd has paid for work of 100000 to abc ltd for some non recurring work and forget to deduct tds ,the expenses of 100000 will be disallowed to xyz ltd.if there will no further transaction between xyzltd and abc ltd ,in that case xyz ltd can not deduct tax from abc ltd hence can not claim expenditure in subsequent year also.
my point is that tds is not a source of revenue for income tax department ,they only collect it as a advance tax on behalf of the firm abc.if abc ltd has discharged his tax liability fully by paying tax
then there will be no loss of revenue to the state .these provision seems valid where the deductee is non resident and tax can not be recovered from non resident.so in the above example dis allowance of the expenditure to xyz ltd even abc ltd has discharged his tax liability fully is not justified but that is the position of law we can not do nothing in this and have to bear with these provisions .so we should be more care full in deduction of tax so that all genuine expenditure will allowed while calculating income of the previous year.
Pratik More
(CA FINAL CS ICWAI AMFI IRDA CGM M.COM ALL NCFM CRTFCT CPM CPA.)
(604 Points)
Replied 02 October 2009
thanx sir..........
Live Course on Invoice Management System (IMS) - 2nd Batch(With Recording)
CAclubindia
