Tds

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 January 2014 I am accountant of a company, here all the employees are taken on contractual basis including me. Here salary/ consultancy fees for previous month(eg Nov) is booked on the 1st of the next month (ie Dec) and payment is also made on same date, based on it TDS is paid on the 7th of the next month (ie jan) is this method correct please help

Nikhil Kaushik

Nikhil Kaushik (Expert)
Follow

09 January 2014 there is nothing wrong with this method. TDS is deductible when the payment is being made...however, the important thing is how you deal the same in March end as you are required to deduct TDS on provisions too!

Querist : Anonymous

Querist : Anonymous (Querist)

09 January 2014 Dear sir,

Thanks for your reply, but here TDS is been deducted under sec 194J i.e. profession & not under sec 192 ie. salary based on this is the method correct since tds can be deducted on payment basis only in case of salary

@VaibhavJ

@VaibhavJ (Expert)
Follow

09 January 2014 Agree with Nikhil ji!

In case of contacted employees payment made to contractors is not amounts to salary but consulting charges u/s 194C / 194J depending on the arrangements.

Nikhil Kaushik

Nikhil Kaushik (Expert)
Follow

09 January 2014 well my comment remain same specially in case of 194J and 194C. TDS becomes deductible on the day you make the payment to the concerned person. so in this case if you pay on 1st of month 1, TDS is to be deposited with govt by 7 of Month 2. However, at march end you need to create provisions for the payables and pay TDS against March only.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now