Tds applicable and accounting entries

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This discussion clarifies the applicability of Tax Deducted at Source (TDS) on commissions paid to doctors and RMPs. It confirms that TDS under Section 194H is applicable if the annual commission exceeds £15,000, with a rate of 5%. The content provides detailed accounting entries for recording commission payments, TDS deductions, and the subsequent payment of TDS to the authorities.

Kollipara Sundaraiah

Kollipara Sundaraiah (Querist)
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29 March 2020 Assess maintained a hospital .assess amount paid below persons.
1.commission paid to another doctors
2.commission paid to RMP persons.

Question:
1. Assess Commission paid amount on tds applicable or no.
2.how to pass on accounting entries.

Eswar Reddy S

Eswar Reddy S (Expert)
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29 March 2020 Tds is applicable subject to limits 15000 limit under 194H @ 5% You may account the Tds in payment entry If commission is 1lac then 1) Commission a/c Dr To Doctor/RMP 2) Doctor a/c Dr 100000 To Bank 95000 To Tds on Commission. 5000 3)Tds on Commission a/,c Dr 5000 To Bank 5000 Alternatively you can account the Tds in first entry..

CA ANILKUMAR B.COM FCA DISA

CA ANILKUMAR B.COM FCA DISA (Expert)
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31 March 2020 As per the relevant provisions, tax to be deducted if the amount paid or credited or aggregate amount paid or credited in a year likely to be paid or credited exceeds Rs. 15000/-. Considering the question, in a view that assessee is liable to deduct tax subject to other conditions , following entries are to be made.
Amount for illustration purpose 1 Lakh. TDS rate 5%
payable entry
1. Commission paid (dr) 100000
Doctor name/RMP name 95000
TDS payable 5000
2. At the time of payment
Doctor name/RMP name 95000
Bank 95000
3. TDS payament
TDS payable 5000
Bank 5000

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