TDS for Customer

This topic explains the process of calculating TDS on customer payments.

TDS calculation and tracking of TDS certificate receivable

TDS can be deducted on receiving payment from customer. TDS can be calculated on the following documents:

  • General Journal
  • Cash Receipt Voucher
  • Bank Receipt Voucher
  • Cash Receipt Journal

TDS certificate will be receivable from customer on receiving the advance payment or issuing sales invoice to customer. TDS Certificate Receivable can be tracked through following documents:

  • General Journal
  • Cash Receipt Voucher
  • Bank Receipt Voucher
  • Cash Receipt Journal
  • Sales Invoice

Mandatory fields for TDS calculation on general journal, cash receipt journal, bank receipt voucher and cash receipt voucher at the time of TDS calculation

  1. Choose the Search for Page or Report icon, enter General Journal, Cash Receipt Journal, Bank Receipt Voucher or Cash Receipt Voucher, and then choose the related link.
  2. Select Customer in Account Type and select relevant customer code in Account No. field. Select G/L Account or Bank Account in Bal. Account Type and select relevant cash or bank account in Bal. Account No. field.
  3. TDS Certificate Receivable field should be marked true and then select relevant TDS Section on journal line, Location Code field should not be blank.

Mandatory fields for TDS certificate receivable tracking on general journal, cash receipt journal, bank receipt voucher, cash receipt voucher and sales invoice

  1. Choose the Search for Page or Report icon, enter General Journal, Cash Receipt Journal, Bank Receipt Voucher, Cash Receipt Voucher or Sales Invoice, and then choose the related link.
  2. TDS Certificate Receivable should be marked true on Journal line or Sales Invoice header.
  3. TDS Certificate Receivable identification will flow into Customer Ledger Entry on posting of the document.

TDS to be calculated on customer receipts (through general journal, cash receipt journal, bank receipt voucher, cash receipt voucher)

  • In the given scenario, advance payment received from customer for INR 50,000 on which 2% TDS is applicable under TDS Section 194C.

    In this case TDS calculation will be as following:

    Component Value
    TDS Base Amount 50000
    TDS Amount 1000 (50000*2%)

    GL Entries will be as following:

    Particulars Amount
    Customer Account -50000
    TDS Receivable Account 1000
    Bank Account 49000

TDS certificate is receivable against payment received from customer or against customer sales invoice

It is required to identify the payment or invoice transaction against which TDS certificate is receivable while receiving the payment from customer who has deducted TDS or issuing the sales invoice on which TDS has been deducted, it is required to identify the payment or invoice transaction against which TDS certificate is receivable.

  1. Choose the Search for Page or Report icon, enter General Journal, Cash Receipt Journal, Bank Receipt Voucher, Cash Receipt Voucher or Sales Invoice, and then choose the related link.
  2. TDS Certificate Receivable should be marked true on Journal line or Sales Invoice header.
  3. TDS Certificate Receivable identification will flow into Customer Ledger Entry on posting of the document.

See Also

TDS Certificate Update

Note

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