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Income tax query

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Ajnas

Student

844 Points Posted on 17 September 2020

Income tax recivable (TDS receivable ) for the previous year in the balance sheet , suppose it is not recoverable from it department? It can be claimed as expense in income tax point of view?

Replies (6)

Quick Summary

This discussion addresses the treatment of TDS receivable shown on a balance sheet that is deemed unrecoverable from the tax department. While TDS receivable is essentially personal income tax and generally not allowable as an expense from a tax perspective, advice suggests reversing the TDS asset back to the customer ledger and claiming it as bad debts, which are allowable expenditures. Communication with suppliers is also recommended if the TDS isn't reflected in Form 26AS.

pratik sanjay mohadikar

accountant

93 Points Posted on 17 September 2020

It's showing in the balance sheet? if it's showing in balance sheet and not in 26as than you should communicate with suppliers to ask the reason of not seeing the same in form 26 as

CA Raj Doshi

Practising CA

8954 Points Posted on 18 September 2020

Better to reverse the TDS asset back into the customer ledger and then claim as bad debts. Bad debts are allowable expenditure. Tds receivable ( considered as income tax ) shall not be allowed as an expense from tax point of view.