Maintain Provisions of Expenses Entries

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This discussion addresses the correct accounting treatment for expense provisions, specifically concerning TDS deduction when the deductee's details are unknown. The consensus is that TDS should not be deducted at the provision stage. For the expense to be allowed in the Profit and Loss account, TDS must be debited on the specific date the expense is recognised, not when the provision is made.

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(Querist)
08 May 2023 Dear sir,

While Making Provision of Expenses we have to deduct TDS or Not, because we don't know Deductee Details ?

Which is proper way to maintain provision of Expenses in books of account ?

Please guide in Deep to understand.
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Dhirajlal Rambhia

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Dhirajlal Rambhia (Expert)
08 May 2023 The provision will not take consideration of TDS deduction.
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SACHIN

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SACHIN (Querist)
12 May 2023 Dear sir,

If we do as per your recommendation, so that Expenses will be allow in P and L ?
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Dhirajlal Rambhia

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Dhirajlal Rambhia (Expert)
12 May 2023 Its not expense due to its provision. For allowance of the expense, you have to debit the expense with TDS on the particular date.
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