Accounting of tds

Save Share

This query is : Resolved

Jigar Chudasama (Querist)

11 July 2014 Dear Experts,
Hello,
My query is
An assessee who is individual has paid some amount say Rs. 150000/- to a builder from whom he is going to purchase a residential flat. On this payment he has deducted tax @ 1% amounting to Rs. 1500 and duly deposited with government.
How to account this Rs. 1500, which is deducted tax by individual, in his books of accounts i.e . in the books of purchaser of residential flat?/
thanks in advance..

CA Devanand Jethanandani

CA Devanand Jethanandani (Expert)

12 July 2014 Hi Jigar,

TDS entries will be,

When TDS is deducted,

Party / builder's a/c. Dr.1500
To TDS payable a/c. Cr.1500

When TDS is deposited with govt.,

TDS payable a/c. Dr.1500
To Bank Dr.1500

Thanks,
Devanand

Message likes : 1 times

Jigar Chudasama

Jigar Chudasama (Querist)

14 July 2014 thank you sir,
but will it capitalize with the cost of the building afterwards??

CA Devanand Jethanandani

CA Devanand Jethanandani (Expert)

14 July 2014 Hi Jigar,

Total amount of Rs.150000 will be capitalized.

TDS will not affect value of building to be capitalized.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now