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TDS ON PART PAYMENT

ABHISHEK (PRACTICE) (38 Points)

25 November 2009  

i AM WORKING IN A CORPORATE. WE HAVE TAKEN SOME PROFESSIONAL SERVICES FROM A CORPORATE AND THEY HAVE SUBMITTED A BILL OF RS 1.5L FOR THE SAME. WE HAVE PAID A SUM OF RS 1 L TILL 31/03/2009. THE BALANCE IS OUTSTANDING AS ON DATE. NOW THE AUDIT OBJECTION IS ON NON-DEDCUTION OF TAX ON RS 1L. THEY ARE OF THE OPINION THAT SINCE THE WHOLE AMOUNT OF 1.5L HAS BEEN RECOGNISED AS EXPENSE DURING THE YEAR 31.03.2009 WE NEED TO DEDUCT TAX. MY OPINION IS PART PAYMENT DOESNOT ATTRACT THE LIABILITY TO DEDUCT TAX AND WE WILL DEDUCT WHOLE OF THE TAX ON BALANCE AMOUNT. KINDLY ADVISE.


 14 Replies

MADHU SUDHAN K (SR.ACCOUNTANT) (74 Points)
Replied 25 November 2009

Mr.Abhishek,

When you are taking whole amount as expense in the year 2008-09, you are liable to deduct TDS on total 1.5 L in the same year. Whether you are paying 1.0L or not, that is not a issue to deduct TDS.

CA Devanshi Gandhi (Ajani) (FCA DISA Mcom CIFRS & LLB)   (9058 Points)
Replied 25 November 2009

 agree

Vidya (Accounts Executive) (564 Points)
Replied 25 November 2009

i agree with Madhu Sudhan

Sunali (Learner) (1317 Points)
Replied 25 November 2009

agree...since date of credit into the account of payee or date of payment, whichever is earlier, is to be taken into account for TDS purposes..

arbind (capcc students) (27 Points)
Replied 25 November 2009

TDS has been deducted on date of booking exp or, date of payment  which ever is earlier,

therefore, u should have been deducted tax during 08-09 on whole amount of exp.

if non deduction of the TDS on this exp , during the f.y 08-09  then whole exp sall be disalloud as per sec. 40(a).

tapas (article assistant) (32 Points)
Replied 25 November 2009

as per provision of income tax act TDS should be deduct on "accrual and payment "of expenses which is earlier.As per ur question , total expenses has been recognised in profit and loss account so the tds should be deduct at the time of making the entry so it is irelevant whether it has patly paid or fully.

Jagdish Narayan Sawant (chartered accountant) (78 Points)
Replied 25 November 2009

 TDS should be deducted on whole amount provided for in the books of accounts irrespective of payment

MITU.... (ARTICLE Assistant) (210 Points)
Replied 25 November 2009

TDS TO BE DEDUCTED ON THE WHOLE AMOUNT.

RULE OF TDS IS TO BE DEDUCTED WHEN ANY ONE OF THE FOLL IS EARLIER

1) PAYMENT

2) ENTRY DONE IN BOOKS

CA PRAVEEN KESHAV (CHARTERED ACCOUNTANT) (331 Points)
Replied 26 November 2009

yaa tds will be deducted on whole amount i.e Rs 1.5 lacs

vijay singhal (article) (299 Points)
Replied 26 November 2009

u hav to deduct tds whether the amount has been paid or not as soon aas it has been creadited (except salary )therefore tds should b made on whole amount

Y. S. Ghodvaidya (Sr. Accounts Executive) (67 Points)
Replied 26 November 2009

Originally posted by :praveen keshav
" yaa tds will be deducted on whole amount i.e Rs 1.5 lacs "


 

Yaa I Am Agree With Mr. Praveen

rehan (audit assistant) (36 Points)
Replied 26 November 2009

hi

if TDS deducted on advance amt and the Balance amt outstanding,we claim a full amt as expenses during the year,our books closed on 31 march every year , Later on we Pay the balance amt dated 1st july deduct TDS on that date and deposited into the central govt, in that case the any question arise of disallowance of expenses u/s 40(a)

rehan (audit assistant) (36 Points)
Replied 26 November 2009

Originally posted by :rehan
" hi
if TDS deducted on advance amt and the Balance amt outstanding,we claim a full amt as expenses during the year,our books closed on 31 march every year , Later on we Pay the balance amt dated 1st july deduct TDS on that date and deposited into the central govt, in that case the any question arise of disallowance of expenses u/s 40(a)
"


 

Romio Laishram (12 Points)
Replied 29 August 2017

TO BE DEDUCTED ON THE WHOLE AMOUNT. RULE OF TDS IS TO BE DEDUCTED WHEN ANY ONE OF THE FOLL IS EARLIER 1) PAYMENT 2) ENTRY DONE IN BOOKS


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