Tds journal entry on FD interest

Quick Summary
TDS on bank FD interest is recorded by recognizing full interest income and showing deducted TDS as receivable under current assets. Discussions cover yearly accrual entries, maturity entries, and treatment for multi year fixed deposits.

Yes it will be under indirect Income
Yes it will be under indirect Income
Ashwini Sir how can Accrued interest have a credit balance??
As per Real account rule (Fixed Deposit) "debit what comes into business"(Asset). TDS receivable is amount deducted by bank as per Income tax rules under section 194, and it is treated as asset in the books. It is shown under current asset on asset side of balance sheet.

Interest accrued on FD A/C-Dr

TDS A/C-Dr

   To Interest Account

The correct journal entry for Tds deducted on accured interest will be:

Accured interest a/c    Dr

Tds receivable a/c       Dr

To    Interest on FD a/c

Interest on fd will be our income with total value 

accured interest will be open in current account and same as Tds receivable 

BASIC QUATION IS UNDER WHICH GROUP "TDS RECEVIVABLE " COME UNDER  (IN TALLY)

 

TDS Receivables Under Current Assets,Where You can take set off with tax liability .

We know as a Golden ruld of accounts  FD Interres -comed in i.e Income (as nomial a/c always credit and expenses always debit) but Mr Raja P M showed that so pls clarify me who FD Interest Dr. ??

Dr. FD Account - XXXX Dr. FD Interest - xxxx Dr. TDS* Receivable - XXXX Cr. Bank A/c - XXXX

 

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