TDS Exercise

TDS at Group Level

Booking of Expenses & Deducting TDS and making Payment

Date Particulars

1st Voucher: Journal

January,2023
Dakshin Electronics Pvt. Ltd. is liable to pay rent of ₹ 3,50,000 for office space (Building) to SRN
Constructions Pvt. Ltd.
Since the liable amount exceeds the exemption limit of ₹ 2,40,000, the company decided to deduct
TDS on rent in the same bill.
31st January Voucher: Payment
Dakshin Electronics Pvt. Ltd. made payment of the balance amount of ₹ 3,15,000 after deducting TDS
to SRN Constructions Pvt. Ltd vide Kotak Bank Current A/c cheque 525105.
TDS at Ledger Level
Booking of Expenses & Deducting TDS and making Payment
Date Particulars
1st January Voucher: Journal
Dakshin Electronics Pvt. Ltd., received a bill for ₹60,000 against commission expenses from Max
Services Agency. Since the liable amount exceeds the exemption limit the company decided to
deduct TDS on commission in the same bill.
Dakshin Electronics Pvt. Ltd. made payment of the remaining amount of ₹ 57,000 after deducting
TDS to Max Services Agency vide Kotak Mahindra Current A/c cheque 525106.
Expenses Partly Subject to TDS
Date Particulars
Dakshin Electronics Pvt. Ltd. received a bill from Ali Advertising Agency Pvt. Ltd against the contract for
planning out their advertising and marketing campaigns for ₹ 1,20,000 out of which ₹ 1,10,000 is
towards the advertising services provided.
Hint: ₹ 1,10,000 will be considered for the computation of TDS and the remaining ₹ 10,000 is other
expenses on which TDS should not be deducted.
Dakshin Electronics Pvt. Ltd., made a payment to Ali Advertising Agency Pvt. Ltd amounted to ₹1,07,800
vide Kotak Bank Current A/c cheque 525108.
Dakshin Electronics Pvt. Ltd. incurred brokerage expenses of ₹ 16,000 for services taken from JNR
Services Pvt. Ltd
1st February Voucher: Payment
Dakshin Electronics Pvt. Ltd., made a payment to JNR Services Pvt. Ltd amounted to ₹ 15,200 vide Kotak
Bank Current A/c cheque 525109.
Booking Expenses and TDS Deduction on Crossing Exemption Limit
Date Particulars
Dakshin Electronics Pvt. Ltd. received a bill for ₹ 25,000 (Bill no. 9) from Rakesh Advertising Agency Pvt.
Ltd. towards a contract against online advertising and marketing campaigns for the financial year 23-24.
Note: TDS is not applicable on this bill because the bill value does not exceed the Single Bill value of ₹
30,000.
31st The company received another bill for ₹80,000 from Rakesh Advertising Agency Pvt. Ltd. for online
January advertising and marketing campaigns.
Accounting Multiple Expenses & Deducting TDS later
Date Particulars
2nd January Voucher: Purchase
Dakshin Electronics Pvt. Ltd., made a contract for one year with ZLX Advertising Agency Pvt. Ltd.
towards:
 Commission Expenses - ₹ 25,000

 Advertising Services - ₹ 1,25,000
The company does not intend to deduct TDS on the above transaction while booking the expenses.

Dakshin Electronics Pvt. Ltd., deducted TDS on commission charges and advertising services payable
to ZLX Advertising Agency Pvt. Ltd. against the expenses booked dated 31-Jan-24.
TDS on Expenses at Lower Rate
Date Particulars
1st March Voucher: Journal
Dakshin Electronics Pvt. Ltd. received a bill from AMR Tech Pvt. Ltd. (partnership firm) for ₹ 50,000
towards commission charges.
AMR Tech Pvt. Ltd has a certificate (197-17(1)/23-24) for deduction of income tax at a lower rate of
2% on commission and brokerage TDS Nature of Payment.
2nd March Voucher: Payment
Dakshin Electronics Pvt. Ltd., paid ₹49,000 to AMR Tech Pvt. Ltd vide Kotak Bank Current A/c
cheque 525112.
TDS on Expenses at Zero Rates
Date Particulars
1st March Dakshin Electronics Pvt. Ltd. received a bill from Sahara Co-operative Society (Resident) for ₹
2,60,000 towards rent on building.
Sahara Co-operative Society has a certificate (197A-2(5)/23-24) for non-deduction (zero rate) of
income tax on rent.
31st March Voucher: Payment
Dakshin Electronics Pvt. Ltd, paid ₹2,60,000 to Sahara Co-Operative Society vide Kotak Bank Current
A/c cheque 525113.
TDS on Expenses at Higher Rate
Date Particulars
Dakshin Electronics Pvt. Ltd. received a bill from KPN Sole Proprietor (Resident) for ₹ 35,000
towards technical services received.
Currently, KPN Sole Proprietor does not have the PAN number.
The applicable Income Tax rates for the TDS Nature of Payment - Fees for Technical Services (other than Professional
services) or Royalty to Company Resident - Deductee Type
Nature of Payment Rate of TDS Rate of TDS
(14-05-2020 to 31-03-2021) (01-04-2021 onwards)
Fees for Technical Services (other than 1.5% 2%

Professional services) or Royalty
Date Particulars
Dakshin Electronics Pvt. Ltd, paid ₹28,000 to KPN Sole Proprietor vide Kotak Bank Current A/c cheque
525114, after deducting TDS at 20% (Higher Rate)
TDS Exemptions limit is not crossed
Date Particulars
Dakshin Electronics Pvt. Ltd, incurred transportation expenses of ₹20,000 from Raj Transporters for
the transportation services rendered.
The applicable Income tax rates for payment of ‘Payment to Transporters’ to Company Resident - Deductee Type
Nature of Payment Rate of TDS Rate of TDS
(14-05-2020 to 31-03-2021) (01-04-2021 onwards)
Payment to Transporters
 Individual/HUF 0.75% 1%
 Others
1.5% 2%
Date Particulars
Dakshin Electronics Pvt. Ltd, paid ₹20,000 to Raj Transporters vide Kotak Bank Current A/c
cheque 525115.

TDS Exercise

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TDS at Group Level

Booking of Expenses & Deducting TDS and making Payment

1st Voucher: Journal

31st January Voucher: Payment

TDS at Ledger Level

Booking of Expenses & Deducting TDS and making Payment

1st January Voucher: Journal

31st January Voucher: Payment

Expenses Partly Subject to TDS

1st January Voucher: Journal

31st January Voucher: Payment

1st February Voucher: Payment

Booking Expenses and TDS Deduction on Crossing Exemption Limit

1st January Voucher: Journal

Accounting Multiple Expenses & Deducting TDS later

2nd January Voucher: Purchase

 Commission Expenses - ₹ 25,000

31st January Voucher: Journal

TDS on Expenses at Lower Rate

1st March Voucher: Journal

TDS on Expenses at Zero Rates

31st March Voucher: Payment

TDS on Expenses at Higher Rate

1st March Voucher: Journal

Nature of Payment Rate of TDS Rate of TDS

(14-05-2020 to 31-03-2021) (01-04-2021 onwards)

Fees for Technical Services (other than 1.5% 2%

31st March Voucher: Payment

1st March Voucher: Journal

Nature of Payment Rate of TDS Rate of TDS

(14-05-2020 to 31-03-2021) (01-04-2021 onwards)

31st March Voucher: Payment

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