Mohit (CA) (755 Points)
30 July 2012Dear All,
I just wanted to know the Journal Entry when I recieve Commission Income. As far as I know, is this the entry:
Cash/Bank 80
TDS Recievable 20
To Commission Income 100
Is this entry correct? If yes, I also wanted to know is this TDS Recievable (a Current Asset) c/f throughout or is it reversed at the end of the year? I just wanted to know what are the cases when we can knock off TDS Recievable from the books?
Regards
Mohit
Manjunath
(Audit assistant)
(48 Points)
Replied 30 July 2012
entry is correct,TDS receivable is current asset.
TDS receivable a/c can be knock off against tax payable,
if there is no tax payable can be knock off when u receive refund.
Mohit
(CA)
(755 Points)
Replied 30 July 2012
Are you sure we can set off TDS payable against TDS Recievable? Because Income Tax is a Direct Tax and not an Indirect Tax where set offs are possible?
Manjunath
(Audit assistant)
(48 Points)
Replied 30 July 2012
u got me wrong not against TDS payable, it is against income Tax payable of of the person who is receiving commission.I hope u know TDS is like advance tax on behalf of u the payer of income pays to govt. on receiveing form 16A u can claim credit.
Reversal entry,
1)Income tax a/c dr 100
to income tax payable 100
2)Income Taxpayable a/c dr 100
to TDS receivable a/c 20(u r case reversed)
to cash/bank 80
i hope u got me now :)
CAclubindia
