TCS @ 0.1%

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This discussion clarifies the applicability of the new 0.1% TCS (Tax Collected at Source) on set-off transactions where sales revenue is used to offset liabilities from purchases with the same entity. Experts confirm that TCS is indeed applicable to the set-off value if it exceeds the 50 lakh threshold. A journal entry serves as the documentation for such adjustments.

M Sairam

M Sairam (Querist)
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08 January 2021 Dear Experts,
We made sales to & purchases from the same entity. We are setoff the revenue from Sales to liabilities from purchases. I want to know whether TCS @ 0.1% (which is newly applicable from Oct 20202) is applicable on the setoff value if exceeds 50L?

What kind of document will confirm its setoff both for documentation?