When to deduct tds

This query is : Resolved

DHEERAJ KUMAR (Querist)
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19 May 2016 Sir

I HAVE RECEIVED PROFESSIONAL CHARGES BILL of 28000 PERTAINING TO 2015-16 IN APRIL 2016 AND INVOICE IS DATED 04.04.2016

Now i have to book the expenses in 31.3.2016
IF I deduct tds on 31.3.16 then tds will have to be deposited with interest and i will have to revise the return

Now suggest the way out if i do not want to deposit tds with interest and do not want to revise return.
Can i book the expense without tds on 31.3.16 and deduct tds in May'16 on the date of payment
31.3.16
Professional Charges 28000
to Libilities for Expenses 28000

19.05.2016
Liabilities for EXPENSES 28000
BY
tds on professional Charges 2800
ICICI Bank A/c 25200

Suggest the right way to deal this

Amol S Joglekar

Amol S Joglekar (Expert)
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19 May 2016 194J is applicable once amount exceeds 30,000. Why are you getting yourself entangled with TDS?
https://www.incometaxindia.gov.in/Pages/acts/income-tax-act.aspx

DHEERAJ KUMAR

DHEERAJ KUMAR (Querist)
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19 May 2016 Sir

We have earlier also made the payments to same person during the year so we will have to deduct tds if expense is to be booked in 2015-16

Amol S Joglekar

Amol S Joglekar (Expert)
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19 May 2016 I see. Then you should have anticipated the expenses and made the provision accordingly. Now you are portraying as if it had come all of a sudden.
Better pay interest if you want to book it for the last year.

DHEERAJ KUMAR

DHEERAJ KUMAR (Querist)
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19 May 2016 My seniors have advised just book the expense in prior year adjustment and deduct tds during this year 2016-17
Now explain how will be get the benefit of this expense in which year
some one is saying that at the time of filing of return for FY 15-16 all the expense booked in 16-17 under prior year adjustment will be considered.
clarify the whole scenario of prior year adjustment
Also confirm whether previous year expenses are totally disallowed in current year if the provision is not created in previous year clear the whole fundamentals of this concept

Amol S Joglekar

Amol S Joglekar (Expert)
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19 May 2016 Consistency is the key factor. Normally the expenses of the year is allowed in the same year. This expense is that of 2015-16 and hence will be allowed in the year 2015-16.

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