IF a payment has been made before deducting tds but we deduct and deposit TDS later from our pocket.
Now will the tds so deposited be allowed as expense or not ?
E.g. we paid 50000 to a contractor without deducting tds and later we deposit the tds @ 2% from our on pocket. So will this 2 % be allowed as expense?
Please guide.
Thanks I understand that tds will be deducted on 102% but expense will be booked as 100 % or 102 %.
Entry as
Expense A/c Dr
To TDS payable
Is it correct or not.
And whether the same expense will be allowed or not.
its better to issue debit note on party for TDS amount, otherwise TDS on TDS would arise,
dont claim the TDS amount under expenses
CAclubindia
