Hi Expers...

Suppose X has incurred expenditure on behalf of Y and made a payment to Z in respect of expenditure indcurred.

Then expenditure is reimbursed by Y to X.

Now problem is that who will deduct tax at source.

a) Whether X is liable to make TDS from payment to be made to Z

or

b)whether Y will make TDS from payment to be made to X....

Who has to comply with TDS provisions...

Entries will be made as follows then what to do…..

In the Books of X...

1.Expense A/c. Dr.
To Z a/c.
(booking of Exp.)

2.Z a/c. dr.
to Bank a/c.
(Payment to Z)

3.Y A/c. Dr.
To Expense A/c.
(Debit Note raised on Y)

4.Bank A/c. Dr.
To Y A/c.
(Reimbursement by Y)

In books of Y..

1.Expense a/c. Dr.
To X a/c.
(As per above Debit NOte.)

2.X A/c. Dr.
To Bank A/c.
(Payment towards Exp.)

Now in above case Y is not directly related to Z, while the income is generated by Z only hence the TDS on Z's income shall be made.

However the expenses is claimed by Y in his books and hence the person who is claiming the exp. shall make the TDS otherwise exp. will get disallowed, so he needs to deduct tax from X which is wrong..

Thanks
Rohit

I want to create a private trust in the name of my son who is just one year old. Can you tell me the procedure for registration and taxability of the income of trust. Can this trust except gift from various relatives and its taxability.

The client has a factory at Gandhidham (Gujrat), from where he first transfers his goods to Mumbai warehouse, and then sells his goods to Mumbai customers charging VAT. In this way he avoids CST. Is it correct?

what's difference between Registered Mortgage and Equitable Mortgage in field of banking terminology.

Dear All,
I m in Service providing Company (providing taxable services only) & wants the amount of CENVAT credit by following figures:-

In Aug. month I have received ST amount = 2000000
ST receivable = 5000000
CENVAT on capital goods = 40000

Plz tell me for how much amount i can avail ST credit and how much amount i will have to pay. tell me rule no. if possible.

Thanks,
Anuj

We purchased some parts For Rs, 30000/- and paid labour charges rs. 5000/- and got a single bill for Rs. 30000+Sales Tax And Rs. 5000+ Service tax.

I have to deduct TDS on which amount or do not have to deduct TDS. pls clarify

From 28-09-2008 onwards a declaration in stamp paper stating the evidence of payment of stamp duty is a mandatory attachment to Form 32 in case qualification shares are taken by Directors. What is the value of such stamp paper. Whether subscribers to the memorandum should also comply this requirement.

In the financial year end , some customers bills are not yet settled and we are showing these as sundry debtors in asset side. The service tax in respect of these bills will be received only in the next year. Now in the present balance sheet how can we show it since these amounts are not at all due to us or government because after receipt only government due arises.

Next year after receipt, what is the journal entry for those service tax recipt and remittance to government.

Kindly clarify.

Dear Sir,

I am working in a foreign ship (Shell Co , UK). As per the contract I shall join duty as and when the company requires and i shall be paid salary in US dollars even when i do not work. The salary is paid through their agents in Kochi, Kerala.During the financial year 2007-08 i was in India. During the financial year 2008-09 i will likely to be in India for more that 182 days. Kindly help with regard to the following.

what will be my residential status?

Whether the amount which i receive in US dollars as salary when i am in India is taxable?

Regards,
Priya

Sir,

That the company has SSI unit at Greater Noida (U.P.) and received subsidy through investment grant under intergrated development of leather sector scheme (IDLSS) from Govt. of India toward purchase/ installation of machines.

I want to know how I should account for and pass the entries of the amount of incentive received. This incentive is taxable or non taxable.

machinery cost of Rs.30.00 Lacs, Incentive received Rs.9.00 Lacs i.e. 30% of cost of machinery. please calculate the written down value of machinery and depreication

Sir,
requested you to resolve the query urgently because this query relate to financil year 2007-08

with regards

AMRIK SINGH