Opinion Of Eminent Legal Luminaries On Controversial Issues

How To Reconcile Mismatch Of TDS In Case Of Assessee Maintaining Books Of Account On Cash Basis?

QUERY: Number of professionals including C.A., C.S., Architects, Interiors and Business man like brokers are maintaining books on cash basis (receipt basis) and claiming TDS in the year of receipt of income irrespective of the year to which it pertains. Before introduction of e-filing system, such claim of TDS was allowed in the year of receipt of income. This was settled practice. But after e-filing regime, where credit is given on the basis of 26AS, such professionals and brokers are not getting credit of such TDS due to mismatch of the year. On this account many rectification are also pending.

Kindly enlighten how to overcome this problem.
ANSWER: As clarified by CBDT and prudent accounting practices, you should account TDS in the fees only. Any difference between actual TDS claimed by you and from AS 26 may be informed to the Assessing Officer for corrective action for issuing refund/ raising demand notice. As pointed out by you, rectification in several cases are pending. Further, ITRs 4, 5 & 6 contains columns for both TDS deducted by the payer and TDS claimed during the year by the assessee, which should be filled in carefully to overcome the aforesaid problem.
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One comment on “How To Reconcile Mismatch Of TDS In Case Of Assessee Maintaining Books Of Account On Cash Basis?
  1. Pawan Bhageria says:

    Thanks for clarifying. Does this mean that while law supports but there is no clean way to reflect the carry forward revenue and tds entries to next financial year and you need to deal with AO who may or may not help close the issue in a timely manner?

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