Calculate TDS on Advance Payments

In QuickBooks there are three steps for calculating TDS on advance payments and making the final payment after the services or goods are delivered.

Step 1: Calculate TDS on advance payment

  1. In the navigation bar, click Suppliers.

  2. Click the supplier you want to calculate TDS for.
  3. Click the drop-down list and select, Make advance payment. The Advance Payment window is displayed.
  4. Enter the amount of the advance payment in the Advance payment field.
  5. Click, Calculate TDS. QuickBooks calculates the TDS and displays the TDS amount.

When the supplier or the service provider delivers all the goods or services, you need to create a bill, calculate TDS (on advance payment and remainder amount), make adjustments, generate an invoice, and calculate the net payable amount.

Step 2: Calculate the net payable amount after service or goods are delivered

  1. Click Create (+) > Bill.

  2. Enter the total service amount.
  3. Click, Calculate TDS. The list of all the advance payments made is displayed.
  4. Select the advance payments. QuickBooks makes all the TDS adjustments and calculates the net payable amount.

Step 3: Make the payment

  1. Click Create (+) > Pay Bills.

  2. Click the Make Payment Button. QuickBooks makes the payment to the payee ( Total bill - advance payment - TDS on Advance payment - TDS on the remainder = Net Payable amount).

See also

Tax Deduction at Source (TDS)

Overview of TDS on Advance Payments