TDS on Advance payment to vendor

sandip

Hi All

I want to know that whenever we are giving the advance payment to Service vendor in which TDS is applicable.

When the System post the transaction in the navision it will post the TDS amount in the G/L entry correctly.

In the vendor ledger entry it will not show the payment entry as deduction of payment after TDS amount.

For E.g. if i pay the advance amount to vendor in the G/L entry it will show the following effect

Vendor A/c - 10000 Dr
TDS payable a/C - 1000 Cr
Bank A/c - 9000 Cr

In the vendor ledger entry it will show the payment entry as 10000/

If the same vendor if i book the invoice entry it will deduct the TDS from the invoice entry and it will show in the vendor ledger entry as 9000.

Please tell me why it is showing this way.

Thanks & Regards,
Sandeep Deshpande

sandip

Hi all

Please help me if anyone knows the solution for the same which i was asked in the query.

thanks & Regards,
Sandeep Deshpande
](*,)

anilspcg

Hi Sandeep,
As per the TDS law TDS needs to be deducted at the time of Invoice booking or Payment whichever is earlier. In this case you already deducted the TDS while making payment so NAV will post the whole amount to Vendor ledger entry as to balance needs to be knock off after Invoice booking.

While booking Invoice make sure to select the Payment entry in Application section, even if you select the TDS head NAV will not calculates TDS if application of payment selected in Application area in Purchase Invoice. So NAV will book the complete Invoice amount to Vendor ledger entry which will knocks off the payment entry.

TDS which is already deducted while making the advance payment will be available in Payment Journal for TDS payment. I think this is how NAV configured for localization.

Regards,
Anil.