Explain the concepts of TDS payable and TDS collected and how these are off set against each other and why they are off set
Dear Student,
TDS is one of modes of collection of taxes by which a certain percentage of amount are deducted by a person a time of making/crediting certain specific nature of payment to the other person and deducted amount is remitted to government account. It is similar to "pay as you earn" scheme also known as withholding tax in many countries.
When you deduct TDS on some payment, then it becomes your liability to submit such deducted amount to government account with in prescribed time. Hence, it is recorded as TDS payable in books of A/c. Amount of TDS collected from parties are recorded as TDS collected and at the time of payment to government, TDS payable is paid to government. TDS payable - TDS collected has to be borne by person.
Regards
TDS is one of modes of collection of taxes by which a certain percentage of amount are deducted by a person a time of making/crediting certain specific nature of payment to the other person and deducted amount is remitted to government account. It is similar to "pay as you earn" scheme also known as withholding tax in many countries.
When you deduct TDS on some payment, then it becomes your liability to submit such deducted amount to government account with in prescribed time. Hence, it is recorded as TDS payable in books of A/c. Amount of TDS collected from parties are recorded as TDS collected and at the time of payment to government, TDS payable is paid to government. TDS payable - TDS collected has to be borne by person.
Regards