TDS On Rent for Building / Flat

Dear all,

Can someone provide me the solution on following transaction.?

1)  Co. is paying Flat Rent Rs. 20000/- p.m. to Mr. A (HUF- Resident). As TDS on Rent for Bldg  @ 10% is applicable. It is to be deducted & payable by Co. But, Mr. A don't want TDS to be deducted from rent amt & full amt of rent is payable to him as per Rent Agrmt. The co. will pay TDS amt to IT Dept. regularly & Full amt of rent to Mr. A.

But, in the books of A/cs, Co. needs to show provisional entry for TDS on Bldg. Rent deducted, Full rent amt paid to Mr. A. & TDS payment to IT Dept.

Pls. explain the 3 A/c entries related to 1st para.

Thanks in advance.....

Ajay

 

 

Replies (1)

in this case rent amount of 20000 is excluding the tds the receiver gets 90%(100-10%tds). you will pass the following entries

building rent ac - - - - -- - -  -- - - - - - dr.(20000/90*100)

                   to mr. a                                                                    20000

                    to tds                                                                         (20000/90*10)

(being rent due)

mr. a ac - -- - - - - - - - - - -dr.20000

                  to bank

(being payment made)

tds ac - - -- - - -  -- - - - - -- dr.

            to bank

(tds deposited)

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