TDS
Where: Accounting → TDS.
Tax deducted at source is handled in three steps: deduct it when paying the vendor, deposit it with a challan, and take the register for the quarterly return.
TDS Sections
The sections and rates used for deduction. Each has a Rate %, a higher No-PAN %, a Single Limit, an Annual Limit and a status. These are provided:
| Section | For |
|---|---|
| 194A | Interest other than on securities |
| 194C | Payments to contractors (company) |
| 194C-IND | Payments to contractors (individual / HUF) |
| 194H | Commission or brokerage |
| 194I-B | Rent — land and building |
| 194I-P | Rent — plant and machinery |
| 194J | Professional or technical fees |
| 194Q | Purchase of goods above the limit |
Add Section adds another; the pencil edits a rate.
Deduct TDS when paying a vendor
TDS is deducted on the vendor payment, not on the invoice.
- Open the posted vendor invoice and click Record Payment (see Vendor invoices and payments).
- Choose the TDS Section.
- Save.
The vendor's account is cleared for the full amount; the tax goes to TDS Payable and the rest is paid from the bank.
:::note How the deduction is calculated TDS is worked out on the taxable value of the bill, not on the GST charged on top. The payment dialog shows the TDS and the net payable before you save: a ₹59,000 payment on a bill of ₹50,000 plus 18% GST under a 2% section deducts ₹1,000, not ₹1,180. :::
TDS Register
Choose the Financial Year and the Quarter and click Load.
Every deduction in the quarter: the deductee, PAN, section, date, amount paid, TDS, rate and status — DEDUCTED until it has been deposited, then DEPOSITED. The tiles total the deductions, the amount paid, the tax and how many have been deposited.
26Q Excel downloads the data for the quarterly return in Form 26Q.
Challans: deposit the tax
When you have paid the tax to the government, click Record Challan.
| Field | Notes |
|---|---|
| Quarter | The quarter being deposited |
| Section | Optional — leave blank to deposit all sections |
| Challan No | From the bank challan |
| BSR Code | The bank branch code |
| Deposit Date | |
| Notes | Optional |
Recording the challan deposits all pending TDS for the quarter: TDS Payable is debited, the bank is credited, and the deductions in the register change to DEPOSITED.
The company's TAN
The TAN is needed on challans and the return. Keep it with your company's registration details.