Query
Is it possible to
account Advance payments to party and deduct TDS on
such advances? How to adjust the advances paid to the party towards the
Bill?
Example: On 15-04-2010, ABC Company made an advance payment of Rs.50,000 to Pheonix Agencies towards
Advertisement Expenses. While making payment tax was deducted form the Source. Advances were adjusted towards
the bill of Rs.2,00,000 dated 26-04-2010.
Solution
Tally.ERP 9 allows accounting advance payments to party and deduct
TDS on the advances and later adjust the advance paid towards the Bill.
Follow the given procedure to account advances
and adjust the advances towards the Bill
Step 1: Record a Payment Voucher (to account advances)
To create a Payment Voucher
Go to Gateway of
Tally > Accounting Vouchers > F5: Payment.
Set up
In F12: configure
(Payment Configuration)
- Ensure Use
Single Entry mode for Pymt/Rcpt/Contra is set to Yes
1. In Account field select the Bank Ledger. E.g. Canara Bank
2. Under Particulars select the party ledger Pheonix Agencies. In Amount field enter the amount paid as advance and press
enter to view Bill-wise Details screen
3. In Bill-wise
Details screen
- In Type of Ref field select the reference as Advance
- In Name field enter the bill name as Adv-201
- Amount will be displayed automatically
[13-63]
4. Accept the Bill-wise
Details screen
5. Under Particulars select tax ledger, TDS - Contractor and press enter to view TDS Details screen
TDS Details screen appears as shown
[13-64]
6.
Press Enter to accept the TDS Details. Tax
deducted will be displayed with negative sign.
The
completed Payment Voucher is displayed as shown
[13-65]
7. Press Enter to save.
Step 2: Record a Journal Voucher (to account the bill &
adjust the advances)
To account the bill
received and adjustment of advances paid
Go to Gateway of
Tally > Accounting Vouchers > F7: Journal
1. In Debit field select the expenses ledger - Advertisement
Expenses. In Debit amount field enter the total bill amount of Rs. 2,00,000
2. In Credit field select the Party Ledger - Pheonix Agencies. Press Enter to view TDS Details screen
3. In TDS Details screen
- In Type
of Ref field select Agst Ref
- In Name field select Pymt/1-2 from the Pending Tax Bills. On selection of Tax bill
Nature of Payment, TDS Duty Ledger, Assessable Amount and Payable Amount will be defaulted
automatically and application will not allow altering the
details.
[13-66]
- In Type
of Ref field select New Ref.
- In Name field Tax Bill reference will be defaulted automatically
- In Nature of Payment select Payment
to Contractors (Advertisement Contractors)
- In TDS Duty Ledger field select TDS – Contractors and set Deduct Now to Yes.
The completed TDS
Details screen is displayed as shown
[13-67]
Observe, the advance of Rs. 50,000 is adjusted towards the bill and TDS is calculated only on the balance
amount of Rs. 1,50,000.
4. In Bill-wise
Details screen select the bill
reference as shown
- In Type
of Ref select Agst Ref, in Name field select the bill Adv-201 dated 15-4-2010 form the pending bills and in Amount field mention the amount adjusted as Rs. 50,000.
- In Type
of Ref select New Ref, in Name field enter the bill name as PA/152/10-11 and in amount filed mention the amount pending for payment
- In Type
of Ref select New Ref, in Name field enter the bill name as PA/152/10-11 and in amount filed tax deducted will be defaulted.
[13-68]
5. In Credit field select the TDS ledger TDS- Contractor. Tax deducted - Rs. 3,000 (on 1,50,000) will be
defaulted automatically.
The completed journal
voucher is displayed as shown
[13-69]
6.
Press Enter to save.
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