09 May 2021
We are in the business of erection of buildings, We often receive invoices in the month of April and May which are having dates of April and May but in the Description of Service they mention crane charges for the month of Jan, Feb and March. Till now we were making provision for it and deducting TDS. Now the party is telling that since they have issued bill in april and they have considered it as income of next financial year, we should deduct TDS in current Financial year. We are also claiming GST in April only when we receive the bills. My question is if we book the expenses in April or May the month in which bill is issued. Will the department not qualify it as prior period expenditure, since in the narration it is written Feb and March Expenses.
11 May 2021
Since invoices are issued by the vendors in April and May , you can claim expenses in Current year only. No need to worry about prior period expenses.
CAclubindia
