Plz help-tds journal entries

TDS 3888 views 10 replies

i) A company has a contract under section 194 c of  rs 35000 with a party.Half of this amount is paid in advance that is rs 17500 paid by company in advance.No bill is issued for that payment. At the end of  the year bill is issued for full  rs 35000.Rest of the payment is made.What will be journal entries.

ii) What will be journal entries if this case was for service tax and not tds 

Replies (10)

(i) Required Entries to booked by contractee i.e. Company

At the time of first payment

Contractor Dr.    17500

to Bank/Cash     15750

to TDS payable    1750

 

at the time of bill received 

Expenses Dr.       35000

party Dr                   1750

to party                    35000

to tds                       1750

 

at the time of final payment 

party dr.                  15750

to bank                   15750 

(ii) if contractor coverved under Service Tax Entries

At tthe time of first payment 

Samer as above

at the time of Bill Received 

Expenses Dr     35000

party Dr.              3932

Service Tax Receivable  4326

to party                39326

to Tds                 3932

 

At the time of final payment

Contractor Dr.   17894

to Bank                17894

.

 

 

 

why have u calculated tds at 5% when under 194 c tds is 2 % only.in the second case i wanted entries for service tax (no tds there)

W.r.t Service tax if the receipt of 35000 the service tax is excluded and it is paid in addition to  as per Mr. Kumar mahesh.

 

If total amount paid by company is Rs 35000 then that amout is gross payment including the amount of service tax

plz give journal entries for both cases 

where service tax is inclusive in 35000

where service tax is exclusive in 35000

where service tax is inclusive in 35000

Contractor A/c Dr.    17500            -

   To Bank/Cash A/c      -            17150 

    To TDS payable         -              350

 

Exp. A/c Dr.                                 31150               -

Service Tax Input A/c Dr.    3850            -

   To Contractor A/c              -            34650

    To TDS payable                 -              350

 

Contractor A/c Dr.           17150            -

   To Bank/Cash A/c      -            17150 

 

where service tax is exclusive in 35000

Contractor A/c Dr.    17500            -

   To Bank/Cash A/c      -            17150 

    To TDS payable         -              350

 

Exp. A/c Dr.                                 35000               -

Service Tax Input A/c Dr.    4326            -

   To Contractor A/c              -            38889

    To TDS payable                 -              437

 

Contractor A/c Dr.         38889            -

   To Bank/Cash A/c            -            38889 

 

1. at  the  time of advance paid:

Party A/c         Dr.           17500.00

BankA/c          Cr.           17500.00

2. at the time of full and final

Party A/c         Dr.           17500.00

Bank A/c         Cr.           17500.00

 
3. there is not to deduct TDS because it is not cross the limit of Sec. 194 C i.e.
30000/- where the amount paid/credit in single
75000/- where the agreeget payment was made during the year......

Sorry,

where service tax is exclusive in 35000

Contractor A/c Dr.         21389            -  

       To Bank/Cash A/c            -            21389 

 

Originally posted by : KumarMukesh (Work in Progress)

(i) Required Entries to booked by contractee i.e. Company

At the time of first payment

Contractor Dr.    17500

to Bank/Cash     15750

to TDS payable    1750

 

at the time of bill received 

Expenses Dr.       35000

party Dr                   1750

to party                    35000

to tds                       1750

 

at the time of final payment 

party dr.                  15750

to bank                   15750 

(ii) if contractor coverved under Service Tax Entries

At tthe time of first payment 

Samer as above

at the time of Bill Received 

Expenses Dr     35000

party Dr.              3932

Service Tax Receivable  4326

to party                39326

to Tds                 3932

 

At the time of final payment

Contractor Dr.   17894

to Bank                17894

.

 

 

 

Ayesha You are correct TDS should be 2%/1% under section 194C depending upon status of contractor.

Assumptions: contractor is other than Individual & HUF. And liable to charge service tax @ 12.36%  

Case 1 where service Tax Included into Rs 35000


At the time of first payment

Contractor Dr.    17500

to Bank/Cash     17150

to TDS payable    350

 
At the time of bill received 

Expenses Dr.       31166/35000           Subject to elibility to take Service Tax input

Party Dr                   350

Service Tax Receivable Dr. 3833/0     Subject to elibility to take Service Tax input

to party                    35000

to tds                       350  (35000*2%-350)
 
at the time of final payment 

party dr.                  17150 (35000-17150-350-350)

to bank                   17150 

 

Case 2 where service Tax excluded from Rs 35000


At the time of first payment

Contractor Dr.    17500

to Bank/Cash     17150

to TDS payable    350

 
At the time of bill received 

Expenses Dr.       35000/39326           Subject to elibility to take Service Tax input

Party Dr                   436

Service Tax Receivable Dr. 4326/0     Subject to elibility to take Service Tax input

to party                    39326

to tds                       436 (39326*2%-350)
 
at the time of final payment 

party dr.                  21390 (39326-17150-350-486)

to bank                   21390 

 

 

Originally posted by : Nitin

1. at  the  time of advance paid:

Party A/c         Dr.           17500.00

BankA/c          Cr.           17500.00

2. at the time of full and final

Party A/c         Dr.           17500.00

Bank A/c         Cr.           17500.00

 

3. there is not to deduct TDS because it is not cross the limit of Sec. 194 C i.e.
 
30000/- where the amount paid/cr edit in single

75000/- where the agreeget payment was made during the year......

The single bill was raised of Rs.35000/- at last so TDS will be deducted.
 

Dear sir,

I kindly requsted you to please rectify my problem details are given here undser

 

There is a Service Bill of Rs.50,000 & Service Tax added 
10.30% & We have to deduct TDS  @  2%. Assume that Service 
Tax Input Credit available to Ur Co. What is the Journal 
Entry for this?

 

P ASHOK KUMAR

ACCOUNTNAT


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