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May 04, 2010 at 05:20 AM

Formulae in TDS Calculation

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Hi

I have a scenario in which TDS has to be calculated as per the following process:

1. For Total Invoices posted upto INR 200000, TDS has to be deducted at 2%.

2. If the total invoices in a year exceed INR 200000, TDS has to be deducted at 10%. However, TDS has to be deducted at 10% only on the amount exceeded above Rs 200000.

For eg, I have posted invoice of Rs 200000 in April 2010. The TDS has to be deducted at 2%. However, in May 2010, I posted additional invoice of Rs 10000, than on this invoice of Rs 10000, TDS has to be deducted at 10%.

I activated the Accumulation feature in the With Holding Tax Type and formulae is maintained as

Base Amount Rate

200000 2%

999999999 10%

However, when the invoice of Rs.10000 is posted, system is not deducting TDS at 10%, but at a higher rate. System is calculating the difference between 10% and 2% and that is also added to TDS amount calculated on Rs 10000.

The requirement is that system should deduct TDS on Rs 10000 at 10% only.

Regards

Sanil Bhandari