CA-STUDENT
650 Points
Joined October 2008
TAX DEDUCTED AT SOURCE(TDS): Any payment made or expenses provided in the books of account which are referred u/s(s) 192 to 196 D are subject to TDS.
In other word, if we make payment for the expenses which are referred u/s above section, We shall deduct an amount calculated on rate prescribed by the government and the balance amount shall be paid to the parties.
Likewise if we are crediting any account for booking expenses which are referred u/s 192 to 196D . We shall debit party account for the amount of TDS which is to be deposited in to the governemnt account.
Example We pay Commission referred u/s 194h Rs.10000
Applicable TDS rate is 11.33% or 10.3% 1133
Payable Amt 8867/-
TAX COLLECTION AT SOURCE(TCS): Every person being a seller collect tax from the buyer of goods mentioned u/s 206C of the income tax Act, 1961. and the same shall be charges by the seller on the invoice and shall be deposited in the government account in prescribed period.
Example : a Buyer sells Scrap for Rs. 10000
Add : TCS @ 1.133% (if surcharge is applicable) 113
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