Tds credit or paid wihich ever is earlier

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Querist : Anonymous

Querist : Anonymous (Querist)

27 December 2012 Dear CCI Members
one pvt company is deducting tds as follwos u/s194c
bill date-26/11/12
payment date-8-12-12
entry in tally date-27-11-12
on which date TDS to be deducted & deposited

CA Navin Jain

CA Navin Jain (Expert)
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27 December 2012 date of tds deducted-27.11.12
date of deposit 07.12.2012

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Querist : Anonymous

Querist : Anonymous (Querist)

27 December 2012 Dear Navin,
one more clarification i need

if the entry date in tally is 2/12/12
than

CA Navin Jain

CA Navin Jain (Expert)
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27 December 2012 DEPOSIT DATE IS 07.01.13

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Querist : Anonymous

Querist : Anonymous (Querist)

27 December 2012 but the bills related to the month of nov12,we made only entry in 2/12/12 when it come to the accounts dept,

BILL DATE 26/11/12
GRN DATE 27/11/12
Tally ENTRY DATE 2/12/12
PAYMENT DATE 8/12/12

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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27 July 2025 Hey! About the TDS deduction and deposit date question, here’s the practical approach as per Income Tax rules and common accounting practice:

**When to deduct TDS under section 194C (contract payment):**
TDS should be deducted **at the time of credit of payment to the contractor's account OR at the time of payment, whichever is earlier**.

In your case:

* Bill Date: 26/11/12
* GRN Date (Goods Receipt Note): 27/11/12
* Tally Entry Date: 02/12/12
* Payment Date: 08/12/12

The earliest credit/payment date is the **GRN Date 27/11/12** (usually the date when liability arises and is recorded in accounts), so TDS should be deducted on or before this date.

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**When to deposit TDS:**
TDS deducted in a particular month should be deposited by the **7th of the next month**. So if TDS was deducted on 27/11/12, the deposit should be made by **7th December 2012**.

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**In your scenario:**

* TDS deducted on 27/11/12 (when liability/entry arose).
* Payment made on 08/12/12.
* TDS should be deposited latest by 07/12/12.

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**If deposit date is after 7th December (e.g., 07/01/13), it will be late and attract interest and penalties.**

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**Summary:**

* Deduct TDS at earliest date of credit or payment (here, 27/11/12)
* Deposit TDS by 7th of next month (07/12/12)

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If your payment date or entry date is after the bill date, it does not matter for TDS deduction — the earlier of credit or payment governs.

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If you want, I can help draft a stepwise guideline or even prepare a note for your accounts team to avoid confusion. Would you like that?

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