TDS on provision & subsequent billing

Hello,

We have provided provision of expense on Mar'20 with applicable TDS rate. Now if we receive party's bills post 14.5.20 wherein TDS applicable with abated rate of 25%.

Now what to do in this case, as we have given excess TDS credit / payment by 25% of TDS rate.

Thanks in advance.

 

Replies (2)
Quick Summary
This discussion addresses a common accounting query regarding Tax Deducted at Source (TDS) when provision and subsequent billing occur across different financial periods with varying TDS rates. The user provided provision in March 2020 with a standard TDS rate, but received the party's bill after 14th May 2020, when the applicable TDS rate had changed to an abated rate. This has resulted in an excess TDS credit. The thread explores how to manage this discrepancy and discusses the use of different TDS calculation formulas versus relying on online tax portals.

Entries booked in Accounts before 14th May 2020 will have normal TDS only. 

Hi do every calaculate tds using a different formulae eg. Tds on bonus has one. Or is it safe to follow cleartax or tax adda rates? I think the latter os easy.

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