TDS Deduction on gst credit note

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This discussion clarifies how Tax Deducted at Source (TDS) should be calculated when a credit note is issued against an original invoice. The consensus is that TDS should be deducted on the net amount after the credit note's value has been subtracted from the original invoice amount. For example, if an invoice was for £50,000 plus GST and a credit note for £5,000 plus GST was issued, TDS would be calculated on the remaining £45,000. The relevant section of the CGST Act 2017 regarding credit notes is also referenced.

Vikrant Singh Deo

Vikrant Singh Deo (Querist)
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25 July 2023 A raise a invoice of 50000 base value + 18% gst to party B
and A Raise credit note against the upper invoice of 5000 +18% gst to party B

When B will make the payment to A then at what value B will deduct the TDS ?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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25 July 2023 Deduct TDS after considering credit note.

Vikrant Singh Deo

Vikrant Singh Deo (Querist)
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25 July 2023 sir can u share the calculation tds rate 2% and under what section this process is done .

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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25 July 2023 It's 2% on 45000 after deduction of credit note 5000.

Vikrant Singh Deo

Vikrant Singh Deo (Querist)
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25 July 2023 sir can u tell the rule no in gst law or any link for this case

Vikrant Singh Deo

Vikrant Singh Deo (Querist)
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26 July 2023 please help on the upper question

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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26 July 2023 Under Section 34(1) of the CGST act 2017, a credit note is defined as a document that is issued by the supplier of goods/services to the recipient when: The issued tax invoice has charged a tax amount that is more than the amount that should be payable due to such supply. The receiver returns the supplied goods.

Vikrant Singh Deo

Vikrant Singh Deo (Querist)
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27 July 2023 this is applicable in case of discounting also ?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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27 July 2023 Yes you are right...
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