How to take TDS Credit utilisation from Service tax

Dynamics 365 Business Central/NAV User Forum
#1

Hello there

I am using NAV 2009 Indian Database. I have configured whole features of Service tax. Now we have a transaction which has service tax as well as TDS to be deducted.

I have posted the same through Invoice including TDS in the Invoice header only.

Now when i make the payment to vendor after deducting TDS, it takes the Service tax credit for full amount including amount of TDS .

Now here it is wrong, Actually, As per service tax provision, I can take service tax credit only when i have made the payment of respective accounts, I have deducted TDS and not paid still it is transferring full amount of Service tax.

For Example, Rs.100000 + 10.3% Service tax bill = Rs.110300 Invoice value for Professional.

I have to deduct TDS@10% means Rs.11030.

I have posted the above invoice on 01.04.2010.and make the payment of balance to vendor Rs. 99270 on 25.04.2010. When i apply this payment against the invoice it transfer full service tax amount credit instead of Rs.9270

And i make the payment of TDS of Rs.11030 on 03.05.2010, so actually S tax credit of Rs.1030 should now be taken to be utilised.

How to solve this?

#2

Hi,

Can you check the Vendor Ledger Entry if the TDS Amount Including SHE Cess is blank.

If its blank then its a problem.

#3

Service Tax credit will be available when you pay the vendor invoice and not the deductions (tds to Govt.).

You should check the relevant conditions of the service tax or consult some good tax consultant if you still havedoubt.