We are Partnership concern and deducted a TDS of 10% of a Proprietor Concern for a professional fees. I want to know whether we are eligible for the credit of the same.
Vikas
(CA)
(1135 Points)
Replied 27 November 2011
Mr. Bhavesh,
You have deducted TDS over the income of the other....it is nothing but thet income tax of the party to whom you have made the payment....
It is a mechanism by which that party's tax will be paid by you...
So you will not get any tax credit for the TDS deducted by you...as it is not your tax but that party's income tax...
But if applicable to you then you will have to practice such things....
You will get the TDS credit of the payments that you receive from others after TDS deduction
E.g, Suppose you have earned an interest of Rs.25000/- on your deposits in a bank. then the bank will pay you Rs.22500/- after deducting the TDS of Rs.2500/-... You will be eligible for this tax credit of Rs.2500/- as it is a tax paid by the bank on your behalf...So you will pay your tax by Rs.2500/- lesser...
CAclubindia
