How to record TDR related transaction

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EAGLE REALITIES (Querist)
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18 September 2024 Hi Sir,
Please let me know that how to record TDR transaction in Tally as well as effect of RCM / GST. suppose we are purchasing the same and utilizing the TDR in our site, then hoe to book TDR purchase & settlement of TDR transaction..?? please explain in details with tax effects.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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12 August 2025 Sure! Here’s a detailed explanation on how to record TDR (Transferable Development Rights) transactions in Tally, along with the GST and RCM implications:
What is TDR?
TDR is a right purchased from a landowner or development authority that allows you to increase the built-up area beyond normal limits.
It is an intangible asset and its accounting and GST treatment depend on the nature of transaction.
Accounting Treatment of TDR
1. At the time of Purchase of TDR
Entry in Tally:
TDR Asset A/c Dr. (at cost including GST, if any)
To Vendor / Developer A/c (Credit Purchase)
GST Treatment:
If TDR supplier is registered under GST and charges GST on TDR sale, you can take Input Tax Credit (ITC) on that GST.
If TDR supplier does not charge GST, you may be liable to pay GST under Reverse Charge Mechanism (RCM) on the value of TDR purchased.
RCM on TDR purchase:
You must calculate GST @18% (usually) on TDR value.
Pay GST under RCM in GSTR-3B.
Take ITC of the RCM paid GST (if eligible).
Example:
TDR purchased for Rs. 10,00,000.
GST @18% = Rs. 1,80,000 under RCM.
2. At the time of Utilization of TDR
When you utilize TDR in your construction/project, it is not a sale but a capital expenditure.
No GST on utilization as it's a right being utilized for your own property development.
The TDR cost (including GST paid on purchase) will be capitalized in your project cost or fixed asset cost.
Summary of GST Implications on TDR Purchase & Utilization
Event GST Treatment Accounting Impact
Purchase from registered supplier GST charged by supplier; ITC available Debit TDR Asset + GST Credit
Purchase from unregistered supplier GST under RCM (pay and claim ITC) Debit TDR Asset + GST payable (RCM)
Utilization of TDR No GST charged Capitalize cost in project
Sample Journal Entries in Tally:
If supplier charges GST:
TDR Asset A/c Dr. 10,00,000
Input CGST A/c Dr. 90,000
Input SGST A/c Dr. 90,000
To Vendor A/c 11,80,000
If no GST charged by supplier, RCM applies:
TDR Asset A/c Dr. 10,00,000
To Vendor A/c 10,00,000

GST RCM Payable CGST A/c Dr. 90,000
GST RCM Payable SGST A/c Dr. 90,000
To GST Payable (RCM) 1,80,000
After paying GST under RCM:
GST Payable (RCM) A/c Dr. 1,80,000
To Bank/Cash A/c 1,80,000
How to record TDR utilization:
When TDR is utilized for construction:
Construction Project/Asset A/c Dr. 10,00,000
To TDR Asset A/c 10,00,000
Points to Remember
Confirm if GST is charged by the TDR vendor or not.
If no GST charged, pay under RCM and claim ITC.
Capitalize the cost of TDR in your project cost.
No GST on utilization of TDR.

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