TDS Credit

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Rakesh Gupta (Querist)
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15 July 2010 A company has recd some commission Income in AY 2010-11 and accordingly booked the same in the accounts. However, the other party has booked the expenditure in AY 2011-12 and accordingly the TDS is deducted in AY 2011-12. Can the company book TDS Credit for AY 2011-12 in advance? What could be the alternative treatment in the books of the company?

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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15 July 2010 YOU HAVE TO SHOWN IT IN AY 2010-11 AS ADVANCE. AND BOOKED AS INCOME IN AY 2011-12, BECAUSE PARTY HAS CLAIMED IT ALSO IN THIS YEAR. BY THIS WAY YOU CAN CLAIMED TDS CREDIT ALSO EASILY.
UNTIL & UNLESS OTHER COMPANY BY WHICH YOU HAVE RECD AMOUNT , HAS NOT BOOKED IT as EXPENSE, THEN HOW YOU CAN TREAT IT AS INCOME.

Rakesh Gupta

Rakesh Gupta (Querist)
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15 July 2010 Sir,
Thank you for replying. The other company has claimed it as expenditure and also issued the TDS Certificate but in the AY 2011-12. However, the company which has recd the money wants to the show the Income in AY 2010-11. Accordingly, it has shown the Income in P&L A/c and TDS as TDS Receivable AY 2011-12 in its books though the credit for the same is not claimed. Is the approach adopted by the company is correct? Whether it can claim TDS Credit in next year & show Income in current year?

CA. BIJENDER KR. BANSAL

CA. BIJENDER KR. BANSAL (Expert)
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15 July 2010 NO, IT IS BETTER TO SHOW INCOME & TDS IN AY 2011-12. OTHERWISE IT MAY BE POSSIBLE THAT AO ISSUE NOTICE YOU IN AY 2011-12 FOR UNDER-ESTIMATE THE INCOME.

mohinder kansal

mohinder kansal (Expert)
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15 July 2010 the company can show income in the AY 10-11 and claim TDS in the same year i.e., 10-11. TDS is allowed in the year in which income related to that TDS is shown. pl. read section 199 of the Act

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