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VAT form 402

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This query is : Resolved

survesh (Querist)
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25 September 2009 Dear Friend

A company has deducted TDS on Vat for a Civil contractor Bills Rased but the Civil Contractor has not Charges or Rased bill with Vat.Where Should I Account TDS on Vat In Current Asset OR as a Direct Expense and can the TDS of Vat can be clamed for Incometax

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CP Ram

CP Ram (Expert)
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25 September 2009 If you have received payments for civil contracts after deduction of WCT-TDS, then following is the accounting treatment for the such TDS amount:

1) WCT - TDS Receivable A/C Dr. (Loans & Advances - Current Assets)
----To Debtor A/C
(Being WCT-TDS deducted by party on Civil contract).

2) VAT / CST payable A/C Dr.
----To WCT - TDS Receivable A/C
(Being WCT-TDS credit utilised for payment of VAT / CST).

Note:
1) You cannot claim WCT-TDS against your Income Tax Liability...

2) You can claim such TDS only against your VAT / CST Liability...

3) If you are an Unregistered Dealer, then you can directly expense out such TDS amount..

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