Question ID : 40704

TDS CREDIT MIS MATCH

Q. The assessee is carrying the business of clearing and and forwarding agents and the assesee has received amount related to his services as well as out of pocket expenses ( pure Agent) services and the Assessee Customer has deducted the TDS on out of pocket ( Pure agent ) services also. at the time of filing of the ITR the Assessee has shown in the profit and loss account only the services which he has rendered not the out of pocket expenses since this is not income .after filing of ITR they have received the intimation as defective notice. the assessee has submit the reply against this defective notice by way of note that out of pocket expenses is not the income of the assesee this is pure agent services and customer has deduct the TDS . Now the asssee has received the Intimation u/s 143( 1) in which TDS Credit is Mis match showing in the statement while full tds are reflected in 26 AS till date. Please sugeest what are remedies for that and we should file the rectification . please give your valuable suggessions for that.

Though it is not correct to deduct TDS on Expenses reimbursed, since it is done in your Client's case, you need to revise Financial Statements, reflecting the amount of Reimbursement of Expenses on Credit /Income side and relevant expenses on Debit/Expenditure side in Profit and Loss Account. Presenting this, file Revised Return (time is available till July 31st if it is Financial Year 2018-19) if not file Rectification. Mere explanation will not serve the purpose. It needs to be reflected in Financials.