Tax Deduction at Source

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Mayuri Gavaral (Querist)
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17 March 2008 1) Is there a distinction between revenue and capital expenditure for making TDS?

2) Do we need to make TDS for provision made during the year (for e.g., audit fees)?

3) What is the consequence if TDS is made without applying for TAN?

CA J M Pattanayak

CA J M Pattanayak (Expert)
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17 March 2008 1) No. On the expenditure TDS has to be deducted . and its management's decission as to whether to consider the Expenses as Capital Expenditure or Revenue Expenditure.

2)Provision has to be made for TDS when expenses is accounted and should be paid within the time limit.

3)Without TAN tax can be deducted but cant be paid to the IT Dept. and at year end TDS certificate cant be issued. Apart from this legal consequencies to be faced.
So only after getting the TAN One must deduct TDS.

Guest

Guest (Expert)

17 March 2008 1) There is no distinction between revenue and capital expenditure for the purpose of deduction of tax at source.TDS has to deducted on payment of expenditure on the payment or credit whichever is earlier.
2)Again TDS has to be deducted on basis of accrual or payment which ever is earlier.
3)You can deduct TDS without TAN but without TAN neither you can deposit the tax in to incometax department nor you can file your TDS return. So TAN number has to be taken.

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