Tds is direct or indirect tax

7/11 Tax Deducted at Source Tax Deducted at Source Setup This document provides details of the functional flow of Tax Deducted at Source (TDS) from GST infrastructure configuration perspective. Post GST, the TDS solution capability and functionality remain the same. The TDS setup and the way it is configured has changed. Setups for Withholding Tax (TDS) Define Tax Authority The TDS standard Invoice is generated against the supplier defined here. The liability arising from the Income Tax Deducted at Source, while making Supplier payments are accounted against an Income Tax Authority. Create a Supplier and assign the Site for this Authority. Additionally, in the Type field on the Classification tab, choose Tax Authority-IND. On doing this, when defining a Tax Deduction at Source Tax Type, the Supplier Name is listed in the Vendor field list of values on the Tax Definition window. You define the Tax Authority using (N) India Local Payables > Oracle Payables > Suppliers > Entry. Define TDS Tax Calendar Define a special accounting period as TDS financial Year in the standard AP Periods Definition window. This period start from 1-Apr and ends on 31-Mar of next year as the Year type. After defining the TDS period, assign it to the TDS regime as TDS financial Year. You define the TDS financial year using, (N) India Local Payables > Oracle Payables > Setup > Calendar > Accounting > Periods. Specify the Calendar as, TDS_CALENDER, Period Type as Year, and start and end date must be a...

NEW DELHI: Government's primary source of earning money is from taxes and non-tax revenues. Taxes are collected in the form of direct and indirect ways. Direct taxes include income tax, real property tax, personal property tax, or taxes on assets; while some of the indirect tax modes include GST, customs duty and tax deducted at source (TDS). On the other hand, non-tax revenue is the recurring income earned by the government from sources other than taxes. The top receipts under this are interest and dividends and profits received from public sector companies. Goods and services tax or GST did a complete makeover in the manner in which indirect taxes were collected. Direct taxes (personal income tax and corporate tax) accounted for 51.3% of total revenues in 2016-17 and the rest came from indirect taxes. In 2020-21, the figure stood at 56.4%, corporate tax at 28.1% and personal income tax at 28.3%. After the new indirect tax regime was introduced in 2017, the Centre’s major source of indirect tax collection changed to GST. GST subsumed more than a dozen of state levies and overhauled the indirect taxes (with the exception of customs duties). The taxes are now decided by the GST Council and not the government. In 2020-21, 28.5% of the revenue came from GST followed by corporate tax and personal income tax, 28.1% and 28.3% respectively. The gross GST revenue collected in the month of December 2020 rose to Rs 1,15,174 crore, an all-time monthly high since the implementation of...

The Government of every country needs funds to spend on the economic and infrastructural development of the nation. These funds are sourced from the citizens of the country in the form of taxes. Taxes are, therefore, compulsory payments done by the residents of a country to their Government for meeting the cost of basic public amenities. In India, The Constitution has given the Government the right and the authority to collect taxes from Indian residents as well as non-residents earning income in India. India has a three-tiered tax structure which is as follows Types of tax in India In India, there are, broadly, two different types of taxes. • Direct tax Direct tax is one that is levied directly on an individual and paid by him/her to the Government. The income tax that you pay on your income is a common example of direct tax. You cannot avoid paying direct tax if you earn an income in a financial year and the income exceeds the specified threshold limits. • Indirect tax As the name suggests, indirect tax is a type of tax that is indirectly levied on an individual. The tax is, usually, levied on goods and services and forms a part of their cost. Thereafter, if you purchase such goods and services, the tax liability passes onto you and you pay tax on it which has been included in the price. You can avoid paying an indirect tax if you don’t buy the goods and services on which the tax has been levied. GST is a very common example of indirect tax that you have to pay if you bu...

In this post, we will see the differences between the Tax Deducted at Source (TDS) as well as Tax collected at source (TCS) in a nutshell. We will cover the following topic: • • • • In the Finance Act, 2020, the government introduced Tax Collected at Source (TCS) in Section 206C (1H). Then in the Finance Act, 2021 Tax Deducted at Source (TDS) was introduced in Section 194Q. There are 2 types of tax collection in India, and they are: • Indirect Tax (example-Tax Deducted at Source (TDS) • Direct Tax (example-Tax Collected at Source (TCS) What is TDS? Any company /individual (deductor) makes a payment to another entity (deductee), deducts TDS if it is above a specific threshold limit, and pays it to the government. Some examples for which TDS is applied are casual income, one’s salary, interest on securities, payment of fees, payment of brokerage or commission, and so on. Note: • The total income of an assessee for the previous year is taxable in the assessment year. • Every payment does not have a TDS deduction and its rate is fixed by the Income Tax department. Now let us see some examples for TDS: • Mr X is a full-time employee of Mad.in Private Limited. He receives a monthly salary. Mad.in Private Limited deducts some amount of tax from his monthly salary before paying it to him. The deducted amount from the salary of X before payment of salary is the TDS. • Mr D sells services/products to Mr E for Rs.4000 (tax rate-5%) So, Mr E has to pay Rs.3800 to Mr D, and the balance...

ME • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • India • USA • Singapore • British Virgin Island • Cayman Islands • Panama • Bermuda • Netherlands • Switzerland • Luxembourg • Dubai • Gibraltar • Hong Kong • Jersey Islands • Anguilla • Bangladesh • Myanmar • Sri Lanka • Vietnam • Belize • Cambodia • Indonesia • Thailand • Philippines • Liberia • 03 Sep, 2021 Under the concept of income tax, the total income of an assessee for the previous year is taxable in the assessment year. The government’s primary source of income comes from such levy of tax. There are provisions provided in the Act through which one may recover tax on their income in the prior year itself. It can be done through TDS and TCS. In this article, we shall understand the concept of Tax deducted at source and Tax collected at Source as they are not the same. Table of Contents • • • • TDS and TCS- Brief Overview TCS or Tax collection at source and TDS or Tax deducted at Source refers to obligation that is deducted at the instance of payment or received and deposited to the Income Tax De...