QUERY AGAINST FOR PROVISION FOR EXPENSES, Income Tax

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Dear Sir/Ma'am,

Actually, I want to some doubt clear with you, I have finalized my pvt ltd company books of account and My auditor have aleardy passed some provision entries in my books of accounts as on 31-03-2023(2022-23). Auditors have pass the the some provision entry in my books of Accounts. Audit fees Dr. 100000.00 To Tds on Audit fees Cr. 10000.00 To Audit fees Payable Cr 90000.00 (Provision due for the year) Please clear my point what is the releveance of entry as of now going of month october, 2023 and my auditor giving me the bill of Rs. 1 lac (no charge the gst in the invoice) So, now this month What kind of entry passed in my books of account in this related provision and and which month & Quarter i deposited the Tds amount and return (2023-24). can i have to file the tds return third quarter 2023-24 nethier 2022-23 quarter-4.

Please assist us for giving me the pratcikal example. Please

Posts / Replies

[Padmanathan Kollengode]

The provision entry is made to book the expense related to previous year in the previous year itself, though the payment is made in the subsequent year. Now when the payment is actually made in the current year, it should be debited against the provision.

Now with regard to TDS the issue is quite debatable. Theoretically speaking TDS is to be deducted in last quarter of 2022-23. There are many tribunal decisions also on this view Citadel Fine Pharmaceuticals (P.) Ltd. Vs ACIT (ITAT Chennai) - 2018 (4) TMI 925 - ITAT CHENNAI.

Another view is that provision made on last day of PY is reversed on first day of current year and TDS payment is made on actual payment.