TDS on W.I.P

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jayaraman subramanian (Querist)

07 October 2008 Dear Sir/Madma. I am an accountant in forbes ltd co.(Its an IT Co.) My Query is every month we pay Rs. 100000/- as Software Development Charges and we deduct T.D.S u/s 194 J. Now we have been informed that the charges should be taken under Work in Progress as it is for the development of Software and once the software is developed it should be capatilised and depreciated accordingly. I would like to know whether i should deducted TDS on software develpment charges as i show it under W.I.P in my books of account.

Kindly solve my query

Regds
Jayaraman S

PIYUSH JAIN

PIYUSH JAIN (Expert)

07 October 2008 Dear Jairam,
tds will be deducted because tds is on Income and it is a income for other party.
Sorry for previous one.
CA PIYUSH JAIN

CA V. Mohanakrishnan

CA V. Mohanakrishnan (Expert)

07 October 2008 the deduction is made from the creditors income and remitted to the department. whether u put the same to use now or later is of least significance as far as deduction of tax is concerned

TDS should be deducted

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