Settle TDS payments to TDS authority vendors and generate TDS challan
This article explains how to settle Tax Deducted at Source (TDS) payments to TDS authority vendors.
Go to Accounts payable > Payments > Vendor payment journal.
[
]On the Vendor payment journal page, select New to create a journal line.
In the Account field, select the TDS authority vendor to settle TDS payments to.
Select Settlement transactions to open the Settlement transactions page, where you can view the settled TDS transactions for the TDS authority vendor.
The settled TDS transactions for a settlement period are shown in the following way:
- TDS transactions where the nature of assessee category is Company are shown as one transaction line.
- TDS transactions where the nature of assessee category is HUF, Firm, Individual, AOP, BOI, Local authority, or Others are shown as one transaction line.
- The Amount field shows the total TDS amount that is due to be paid to the TDS authority vendor.
Select Withholding tax transactions to view the different TDS transactions that are included for the settlement record. You can view the split of each TDS transaction that has been included in the settlement process for the settlement period on this page.
On the Overview tab, select the Mark check box for the TDS transactions to settle to the TDS authority vendor.
The Overview tab shows the following information for each open TDS transaction:
- Date – The TDS transaction date.
- Voucher – The voucher number.
- Source – The module that the TDS transaction is posted in.
- Vendor/Customer – The vendor or customer account number that the TDS is deducted from.
- Name of deductee/party – The name of the vendor or customer that the TDS is deducted from.
- Nature of assessee – The nature of assessee category that the deductee belongs to.
- Amount – The invoice amount that the TDS was calculated on.
- Tax amount – The TDS amount that was calculated for the transaction.
Note
Clear the Mark check box for any TDS transactions that should not be settled to the TDS authority vendor.
On the General tab, the PAN field shows the permanent account number (PAN) of the deductee. The Date field shows the date of the TDS calculation, and the Value field shows the total percentage that was used for the TDS calculation.
Select Voucher to view the voucher entries for the TDS transaction.
Close the page.
Select Withholding tax components to open the Withholding tax components page, where you can view the TDS that was calculated per TDS tax component for a specific TDS tax code.
On the Overview tab, the Tax component field shows the TDS tax component that was used for the transaction. The Amount field shows the TDS amount that was calculated for the TDS tax component, in the base currency. The Accumulated amount field shows the total TDS amount that was calculated for the TDS tax component for all settled transactions.
On the Amount tab, the Default currency section shows the TDS amount that was calculated for the TDS tax component, in the default currency. The Secondary currency section shows the amount in the secondary currency.
Close the Withholding tax components page.
On the Open transaction editing page, in the Amount field, notice that the total amount to settle to the TDS authority vendor for the settlement period is updated.
To settle the TDS transactions of different TDS settlement periods to the TDS authority vendor, select the Mark check box for the transactions.
Close the Open transaction editing page.
Note
If only a few transactions are selected for settlement on the Withholding tax transactions page, the total TDS amount of the selected transactions is updated in the Correction field on the Open transaction editing page. The correction amount is updated on the journal line on the Journal voucher page, and the Open transaction editing page is closed.
On the Journal voucher page, the Debit field shows the total amount to pay to the TDS authority vendor.
Enter the offset account details.
Note
If TDS transactions have different Tax Account Numbers (TANs), journal lines are created per TAN on the Journal voucher page.
On the Payment fee tab, in the Fee ID field, select a fee ID that has a fee type of Interest or Others to charge the payment fee for delayed payments that are made to the TDS authority vendor.
On the Tax information tab, in the Company information section, the Name field shows the company name. In the Withholding tax section, the Tax Account Number (TAN) field shows the TAN that is attached to the transaction line.
Validate and post the journal.
Select Withholding tax > Challan information to enter the challan details for the transaction.
The Voucher field shows the voucher number of the transaction.
Select the TDS deposited by book entry check box if the TDS amount is deposited by using book entry.
In the Challan number field, enter the challan number that is used to make the payment to the TDS authority vendor.
In the Date field, enter the challan date.
In the Bank name field, select the name of the bank that the TDS amount that is payable to the TDS authority vendor should be deposited to. This field lists all the bank accounts that were set up for the TDS authority vendor at Accounts payable > All vendors > Set up > Bank accounts.
In the BSR code field, enter the Basic Statistical Return (BSR) code of the bank.
Close the page.
Example
The period 04/01/2009 is settled for the Rent TDS component group by using the periodic TDS settlement process. The total TDS amount of 141,625.00 is posted to the TDS vendor authority account for the TDS settlement period. You can view this amount in the Amount field on the Open transaction editing page for the TDS authority vendor.
If you select Withholding tax transactions to view the different TDS transactions that were settled for the period, the following information is shown.
| TDS amount |
|---|
| 16,995.00 |
| 22,660.00 |
| 28,325.00 |
| 16,995.00 |
| 28,325.00 |
| 16,995.00 |
| 11,330.00 |
For a specific TDS amount, you can select Withholding tax components to view the TDS that was calculated per TDS tax component for a specific TDS tax code. For this example, you select Withholding tax components for the TDS amount 16,995.00. The tax amount that was calculated per component for the transaction is shown.
| Tax component | Amount | Accumulated amount |
|---|---|---|
| TDS | 1,5000.00 | 125,000.00 |
| Surcharge | 1,500.00 | 12,500.00 |
| PE-Cess | 330.00 | 2,750.00 |
| SHE Cess | 165.00 | 1,375.00 |
If you selected only the TDS amounts 16,995.00, 22,660.00, and 2,8325.00 for settlement on the Withholding tax transactions page, the total amount for settlement is shown as 67,980.00 in the Correction field on the Open transaction editing page. If this transaction is marked for settlement, and the Open transaction editing page is closed, the amount 67,980.00 is shown in the Debit field on the Journal voucher page.
You can now post the journal and generate the TDS challan.
Adjustment of advance payments that are made to TDS authority vendors
To adjust an advance payment that was made to the TDS authority vendor to an actual payment, go to Accounts payable > Vendors > All vendors > Transactions editing. If the actual payment that is made exceeds the advance payment, two challan numbers are generated for the transaction. However, only the first challan number is shown in the TDS inquiry.