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Tds on invoice amount

CA Pooja Agarwal (Chartered Accountant) (3228 Points)

28 September 2012

invoice amout 40000

of which service value 35600 and service tax is 4400..

on which amount should tds be deducted?

entire 40000 or 35600?

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32 Replies

CA.Ankur Khandelwal (Owner) (281 Points)
Replied 28 September 2012

40000 no doubt

Ankit (CA, CS) (3064 Points)
Replied 28 September 2012

Dear Pooja,

TDS is to be deducted on the total amount (incl ST)...so TDS on 40000 not 35600

CA Pooja Agarwal (Chartered Accountant) (3228 Points)
Replied 28 September 2012

doesnt that lead to double taxation?

Ankit (CA, CS) (3064 Points)
Replied 28 September 2012

Pooja,

it does, but thats how it is....as it is finally it will get adjusted when the provider calculates his tax liability

CA Pooja Agarwal (Chartered Accountant) (3228 Points)
Replied 28 September 2012

how will it get adjusted...can you please explain

ACMA Obulirajan R (M.Com, ACMA) (1119 Points)
Replied 28 September 2012

TDS is nothing but its his income and the same can be adjusted finally while filling the return..

Ankit (CA, CS) (3064 Points)
Replied 28 September 2012

Pooja have sent u a PM

CA.Ankur Khandelwal (Owner) (281 Points)
Replied 28 September 2012

yaar pooja simply tax department uska baad main refund de rahi h na.....tax department safer side pr chalti h islye 40000 pe tax deduct krna hota h

1 Like

kedar (Finance executive) (21 Points)
Replied 28 September 2012

Pooja,TDS should be deducted on Rs. 40,000/- only

Sagar Iyer (Article Associate) (32 Points)
Replied 28 September 2012

Thoeratically TDS is to be deducated on amount payable. Interpreting the amount payable as inclusive of any kind of Tax is matter of persepctive.. Respective TDS section specifically mention TDS on specific amount..like on contract.. TDS is deductible on Contract price.. on Commission.. TDS on amt of Commission.. thus it is not incorrect if the TDS is deducted only on the main amount and excluding any taxes ther on... No double taxation happens.. even if its deducted on ST amount.. as TDS is advance tax.. and refund is receivabvle incase excess TDS is deducted as Tax is finally calculated only on INCOME and not on Taxes paid on services or puchased... PERSONAL OPINION .. DO NOT DEDUCT TDS ON GROSS AMOUNT INSTEAD ONLY ON Assessable VALUE!!!..

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CA Pooja Agarwal (Chartered Accountant) (3228 Points)
Replied 28 September 2012

but wont it be better if there is an amendment and tds is deducted on just the value exclusive of service tax ...refund ko koi jhamela nahi

Ankit (CA, CS) (3064 Points)
Replied 28 September 2012

it would be....but you should also understand that what you are talking about is possible only if ST is separately shown....but what if the invoice is for a lumpsumn amount??or that it is continuous supply of service...then what you are talking about will be a problem naa

1 Like