In order to track the supply of goods and/or services, the new GST tax deducted at the source system mandates that the recipient of the supply withholds a small portion of the money that is paid to the supplier and deposits it with the government.
In this article, we will show the TDS entry in tally with GST.
Without any delay, let’s get started.
How can I book TDS on GST in Tally?
On the goods and services received, the government or a government agency may deduct TDS. The deductee, who supplied the goods or services, may claim the TDS amount as a tax credit. To change the TDS amount, you can record a journal voucher.
- First visit the Tally Gateway → Accounting Vouchers → F7: Journal.
- Click J to adjust your stats.
- Select the following options in the Stat Adjustment Details screen:
- To save and go back to the journal voucher, press Enter.
- Enter the amount that can be claimed as a credit after debiting the integrated tax, central tax, state tax, UT tax, and CESS ledger.
- Credit the ledger sectioned off as Current Assets
- To accept the journal voucher, press Ctrl+A.
What is entry of TDS in tally?
You can make an accounting voucher for the cost of the inventory expense along with the appropriate TDS.
- Tally’s website home page → Vouchers → press F9 (Purchase)
- Alternatively, press Alt+G (Go To) → Create Voucher → press F9 (Purchase).
- In order to pick the necessary voucher mode, press Ctrl+H (Change Mode) (Item Invoice, in this case).
- Enter the date and the supplier invoice number.
- Choose the Party Account name.
- Select the Purchase ledger.
- As usual, press Alt+C to instantly create a master. Alternately, you can press Alt+G (Go To) → Create Master → type or select Stock Items → press Enter.
- Select the stock item and input the rate and quantity. The price is automatically displayed.
- Choose the TDS ledger. The price is automatically displayed.
- On the Bill-wise Details screen, complete the necessary information, and to save it, press Ctrl+A.
What is the journal entry for TDS?
The following journal entries for TDS should be made in your business’s books of accounts.
| Audit Fee A/c Dr | xxx | |
| CGST A/c Dr | xxx | |
| SGST A/c Dr | xxx | |
| To TDS on Professional Charges A/c | xxx | |
| To Vendor A/c | xxx |
| TDS on Professional Charges (194J) A/c Dr | xxx | |
| To Bank A/c | xxx |
| TDS on Professional Charges A/c Dr | XXX | |
| Interest A/c Dr | XXX | |
| To Bank A/c | XXX |
| Commission Charges A/c Dr | XXX | |
| CGST A/c Dr | XXX | |
| SGST A/c Dr | XXX | |
| To TDS on Commission A/c | XXX | |
| To Vendor A/c | XXX |
| Vendor A/c Dr | xxx | |
| To Bank A/c | xxx |
| TDS on Commission A/c Dr | xxx | |
| To Bank A/c | xxx |
What is TDS receiveable entry with example?
The total amount invoiced to the parties is passed
| ABC Pvt LTD A/c | 50,000 | |
| To Revenue A/c | 50,000 |
The second entry is passed to book TDS accounts receivable when the net amount is received in the bank.
Receipt Entry
| Bank A/c | 45,000 | |
| To ABC Pvt Ltd | 45,000 |
Journal Entry
| TDS Receivable A/c | 5,000 | |
| To ABC Pvt Ltd A/c | 5,000 |
What is TDS Payable entry with example?
TDS is booked with the amount paid to the payee
| Contract Expenses A/c | 1,00,000 | |
| To Mr. A A/c | 90,000 | |
| To TDS Payable A/c (10%) | 10,000 |
The second input occurs during payment of the amount to the payee
| Mr. A A/c | 90,000 | |
| To Bank A/c | 90,000 |
The third entry where TDS is deducted is paid/deposited to the IT department bank account
| TDS Payable A/c | 10,000 | |
| To Bank A/c | 10,000 |
What is GST payable journal entry in tally?
Intrastate transactions
| Particular | Debit | Credit |
| Purchase A/c | 2,00,000 | |
| Input CGST A/c (18%) | 9,000 | |
| Input SGST (18%) | 9,000 | |
| To Creditors A/c | 2,18,000 |
Interstate transactions
| Particular | Debit | Credit |
| Purchase A/c | 2,00,000 | |
| Input IGST A/c (18%) | 18,000 | |
| To Creditors A/c | 2,18,000 |
| Particular | Debit | Credit |
| Debtors A/c | 1,06,200 | |
| To Sales A/c | 90,000 | |
| To Output CGSTA/c (18%) | 8100 | |
| To Output SGST A/c (18%) | 8100 |
| Particular | Debit | Credit |
| Debtors A/c | 79,000 | |
| To Sales A/c | 70,000 | |
| To Output IGST A/c (18%) | 9,000 |
What is the TDS provision in GST?
TDS stands for Tax Deducted at Source (TDS). According to Section 51, this provision is intended for the government, government undertakings, and other specified entities making contractual payments where the total value of such delivery under the contract exceeds Rs. 2.5 lakhs to suppliers.
The relevant Government/authority shall deduct 2% of the total payment made (1% under each Act and 2% in the case of IGST) and send it to the relevant GST account when making any payments under such contracts.
Where is TDS shown in the Tally?
1. Open the Tally Gateway → F11: Features → Statutory & Taxation.
2. In the Company Operations Alteration page, select Enable Tax Deducted at Source (TDS) and set the value to Yes.
In which type entry is done for TDS calculation?
The following document types can be used for TDS calculations: Purchase order.
- Purchase Order
- Purchase Invoice
- General Journal
- Purchase Journal
Frequently Asked Questions(FAQs):-
1. Is TDS expense or liability?
TDS is always recorded as a liability on the balance sheet because it is the amount that we used to collect for the government from other entities as part of our business operations.
2. Is TDS paid an expense?
The tax that was withheld at source from the recipient of such income may be regarded as the assessor’s cost for the year, making it a cost that the assessor may deduct as a proper business expense.
3. What are the two types of TDS?
TDS certificates come in two different types: Form 16 and Form 16A.
According to Section 203 of the Income Tax Act, a certificate indicating the sum that has been withdrawn (deducted) as tax must be given to the deductee. The deductor is required to give this form to the deductee.
Salaried employers must provide Form 16 to salaried employees, which must include various details such as the amount deducted as TDS, the computation of tax, the deduction of tax, the rate of tax, and the payment of TDS. This requirement applies to people in the salaried class.
For individuals who fall under the non-salaried category, the deductor provides the deductee with Form 16A, which includes all the details on tax computation, TDS deduction, and payments. TDS certificates must be provided within 15 days of the day the return was filed.
Conclusion
We hope now you can record TDS entries in Tally with GST. If you still have any other questions, call or WhatsApp our team. For further information on GST, visit InstaFiling. We are happy to help you.