Tds credit in advance received from customers

TDS / TCS 1850 views 5 replies

CA Bijay Shrestha

Never Give up....No matter what....

858 Points Posted on 22 November 2016

Dear Experts/Friends.

Suppose a Company received Advance Money from customers after TDS deductions and these TDS is deposited by the Customers and reflecting in the 26AS.

The Company Recognises income on percentage Completion method. While filing Income Tax Return, the Company claimed full TDS as per 26AS including TDS on Advance money received. Needless to say that All Advance money is not forming part of Income offered in ITR. But AO did not give credit of these TDS as corrresponding Income/Advance didnot form part of Income OR added Advance on which TDS was deducted to the Income in ITR which is incorrect as far as Accounting method followed is concerned.

Please kindly suggest with proper explanation how can the Company claim full TDS credit.

Also suggest any Supreme Court decision, if any.

Replies (5)

Hitesh Khanna

Accounting & Finance Taxation Company

839 Points Posted on 22 November 2016

as per AS 9 on Income Recognition the Action of AO seems justified.
In case the company wants to to claim full credit , it can do by entering data into the proper fields while filing the income Tax return.
Enter TDS amount to be claimed in this year and the amount of TDS to be carried forward to future years seperately.

CA Bijay Shrestha

Never Give up....No matter what....

858 Points Posted on 22 November 2016

Originally posted by : Hitesh Khanna
	as per AS 9 on Income Recognition the Action of AO seems justified.In case the company wants to to claim full credit , it can do by entering data into the proper fields while filing the income Tax return.Enter TDS amount to be claimed in this year and the amount of TDS to be carried forward to future years seperately.

So you mean to say whatever portion of Advance Money received form part of Income, to that extent only claim TDS. Right?

Hitesh Khanna

Accounting & Finance Taxation Company

839 Points Posted on 22 November 2016

Yes , and the Balance of TDs on afvance money should be claim when such money becomes part of the Income assessable to TaX

Shiva ram

Cpt

22 Points Posted on 23 August 2018

advance received in march and TDS also deducted on total sale value. but actual sale happens on may. If that TDS can be claimed in this year or next year. in 26AS TDS is showing in this year only.in this year,

what is the taxable value

TDS to be claimed in which year