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Discussion < Income Tax < TDS on provision of expenses
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students zone,CA Students
karan


[ Scorecard :197 ]

DO any body know the exact provision of TDS deductibility in provision of expenses at year end.???








Kalpesh Soni


[ Scorecard :80 ]

TDS is to be deducted for the provisions like, Audit Fees payable, Interest payable, Brokerage, etc. so provision made for expenses on which TDS needs to be deducted should be deducted, falling under Section 194s and 192s, and TDS return shall be filed for the same IVth Quarter. Due date for filing the Quarter-IV TDS Return is 15th May so do that accordingly.


professional


[ Scorecard :109 ]

For the purposes of this section, where any sum referred to in sub-section (1) or sub-section (2) is credited to any account, whether called Suspense account or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of this section shall apply accordingly"


then please advice on whose name the TDS details (that we are require to file quarterly) would go.And what if subsequently we found that no such provision was required , but by that time we had already deposited TDS in the Govt a/c.

or lets say that we had made a provision of Rs.10,000 on 31/3 but on 15/4 we got a bill of Rs.6,000. Going by the above expl.(if we take a view that TDS is required to be made on prov as well) we will have to deduct tax on Rs.10,000/ though actual invoice is of lessor amt.


professional


[ Scorecard :109 ]

 where any sum referred to in sub-section (1) or sub-section (2) is credited to any account, whether called Suspense account or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of this section shall apply accordingly"


then please advice on whose name the TDS details (that we are require to file quarterly) would go.And what if subsequently we found that no such provision was required , but by that time we had already deposited TDS in the Govt a/c.

or lets say that we had made a provision of Rs.10,000 on 31/3 but on 15/4 we got a bill of Rs.6,000. Going by the above expl.(if we take a view that TDS is required to be made on prov as well) we will have to deduct tax on Rs.10,000/ though actual invoice is of lessor amt.


Dulichand Kushwaha


[ Scorecard :1960 ]

No TDS except Audit Fees.


Deepika Jain


[ Scorecard :74 ]

As per Income Tax Act,1961,

 

TDS is deductible on date payment is made or credit is given to party whichever is earlier.

So accordingly TDS liability arises.


CA Tarun Garg


[ Scorecard :203 ]

TDS is required to be deducted even if we donot not credit the specific persons account. like in case of commission, audit fees, interest, contractor payment, rent for which we made provision but bill received after March OR payment made after march.

Income tax provision covers suspense account or any other account which includes expense payable also.

 

at the time of filing of Return, mark these provision entry as "Book Entry" for differentiate these provisions entries from others.


Gaurav Agarwal


[ Scorecard :284 ]

TDS shold be deducted while making provision for expenses

1. Deduction of exoenses is reversed if it's not paid before i return filing & will be allowed in subsequent year when it's allowed & same TDS is also reunded/adjusted as the case may  be.

2. Since expense is based on provision so while calculating tds on actual income effect of advance tds  i.e. tds on provision is to be adjusted


K George Philip


[ Scorecard :109 ]

I partially agree with CA Ashish Kumar Goel.  TDS is applicable to all expenditure provided and which are liable for TDS like audit fees, professional and technical fees, consultancy fees, legal fees, brokerage, commission, intetest etc.


CHHAVI AGGARWAL


[ Scorecard :629 ]

It is allowed. TDS has to be deducted either at the time of making payment or at the time of credit, whichever is earlier. So, if you are debiting the P&L a/c, then TDS deduction is mandatory and the related expenses shall also be allowed.


nilesh satelkar


[ Scorecard :54 ]

TO BE DUCTED ON SUCH PROVISION AND TO ALL SUCH TDS DEDUCTED ON FOR MARCH TO BE PAID ON OR BEFORE 31ST OF APRIL


Raj Kumar


[ Scorecard :182 ]

Mr. Karan, pls specify your que more specifically to find exact ans.

 

Exp like audit fee, interest, commission etc.,  TDS surely to be deductible presented below:

Audit fee           Dr. 100

   To Audit fee payable   90

   To TDS professional     10

 

You asked for Provision, Provisions are of various kinds such as provision for gratuity, provision for Bad Debts and like, on which there is no TDS provisions applicability.

Provisions like provision for audit fee(just taking an example), so there is no TDS deductibility because it is just a provision and provision is not actual amount fixed for future payment. we makes provision for securing funds, in case the same exp occurs. This type of provisions are made through P&L a/c and such amount is not final so there is no TDS applicanility.

Further, if provision for audit fee gets adjusted with audit fee payable then TDS deductibility arises, shown below:

 

Provision for audit fee   Dr.  100

    To Audit fee payable                    90

    To TDS 194J                                 10

 

If somebody disagrees with me then their feedbacks are welcome


neeraj


[ Scorecard :79 ]

TDS deducted only at the time of actual payment or at the time of credit in books so if their is not due in books for any expense than how anyone can deduct TDS but if The provision is in the due form (for eg in case of audit fee) than it is equalent to due expense in the books so there is no point of any doubt and TDS is applicable.

If You are not agree with it or want to add something than please reply me.


rahul verma


[ Scorecard :90 ]

Hey Buddy 

Look as per the provisions of TDS, It should be deducted at the time of payment or booking whichever is earlier. It is immeterail about the ledger so if you are using the suspense ledger then also you are liable to get deduct TDS on that.

Now if you are making provision of the expenses at the end of year so you are liable to deduct TDS on the amount of provision if that is covered in the TDS limit/area.

Hope so you get the point. For any further queries, feel free to post me.

 


NARESH PAL GARG


[ Scorecard :74 ]

Yes TDS will be deducted for provision of expenses


himani


[ Scorecard :8 ]

If telephone bill in the name of employee and the experience is reimbursed by the company does it attracts tds ????

I have a consultant for this. For more information: Chartered accountant firms


Vipin Khandelwal


[ Scorecard :74 ]

TDS should be deducted on provision of expenses, because TDS section's uses the word "sum'' & tax deduction has to be on the sum so paid. But on the practical ground sometime it is very difficult to quantify the amount of expenditure which is going to be incurred.

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