Extended Withholding Tax

EWT: TDS Overview



EWT: TDS (Tax Deducted at Source)

• Tax is deducted at source from all payments/provisions which are hit by the TDS provisions of the Act
• Some of the above payments/provisions pertain to services that come within the scope of Tax Deducted at Source (‘TDS’) under the Indian Income-tax Act, 1961 (‘Act’).
• Tax is not deducted from payment for goods
• TDS is required to be deducted at the time of payment or invoice posting whichever is earlier.
• The taxes which are so deducted, will then have to be deposited to the credit of the Indian Government on or before 7^th of next every month.
• The company will have to issue TDS certificates to the vendors for the tax deducted and also file with the tax office, Quarterly & Annual Return‘ of the total taxes deducted during the year under the various sections of the Act. 

EWT: Vendor TDS:




EWT: Vendor Transactions:




EWT: Customer Interest TDS:




EWT: Provisions and Adjustments:

• TDS computed on entries in provisional liability accounts (GR/IR and SR/IR Accounts)
• TDS is computed at each period end on uncleared entries remaining in the GR/IR and SR/IR accounts
• GR/IR and SR/IR accounts relevant for computing TDS on provisions identified separately
• GL accounts to which the provisional TDS is posted identified and document Type used for provisional TDS postings is separately identified
• JV facility available for carrying out changes to TDS relevant postings
• Accounts to which losses (non-recoverable TDS) is to be posted and the document type to be used for TDS adjustment postings is  identified separately.

EWT Activities: