Accounting of withholding taxes

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 January 2015 Dear all

Can you please advise how the WHT paid on royalties and other reimbursables to overseas entities are booked in the hotel’s book?
Specifically, please advise
• the account being used to book these WHT payments and,
• whether these WHT are Deductions in calculating incentive fees.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 January 2015 WHT are deductions in calculating incentive fees and not to be booked as expenses.
The WHT deductions has to be booked under liabilities and WHT payment should be booked against liabilities.

Querist : Anonymous

Querist : Anonymous (Querist)

07 January 2015 but if the agreement is saying that withholding taxes should be born by the Indian Company then?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 January 2015 Book it under the same expenditure head royalties.

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