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Re: Requirement-Deduction of TDS on 31st march for Interest at maturity FD

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Hi Jain,

 

I will explain the requirement in detail.

 

There is a Simple Interest Fixed Deposit of 3 months for 4,00,000 at 10% p.a.

Interest on maturity will be 10,000 and total TDS will be 1000 (TDS rate is 10% on interest)

Start Date- 15 March 2016

End Date-   15 June 2016

In simple interest, the TDS is deducted on maturity.

I have used derived flows for TDS which will flow when the Interest is credited on maturity i.e on 15 June 2016

 

But since 31st march is coming in between the tenure of FD, we need to deduct the TDS on 31st march on the accrued interest which is not actually paid to the client.

Interest will be paid on maturity only.

Interest accrued for 15 days as of 31st march will be 1666 and TDS on it will be 167.

I have to debit this TDS on 31st march 2016 and it should also adjust the TDS on maturity so that TDS on maturity is 1000-167= 833.

 

Derived flow will give a TDS of 1000 which will be wrong in my scenario as  some TDS is debited on 31st march 2016.

 

How can we achieve this?

 

Regards,

Rohan


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