Disallowance in case of short deduction
Pls guide.A deductor deducts short tds on a payment and deposits it say rent paid 50000 and tds deducted only 2500/- and deposited. Now is the whole 50000 is disallowed under income tax assessment or only 25000 is disallowed as he deducted tds on 50% of the payment made.
Total amount on which tds applicable 50000
tds applicable @194I10% is
assuming that tds deducted only on 25000 and deducted and paid rs.2500
amount on which tds not deducted 25000
this needs to be disallowed as per section 40(a)(ia) and the same can be reported.
Make sure the clause 34(a) and Clause 21(b)(ii)(A) should agree each other
Ganesh Babu is right you need to disallow only the amount on which TDS is not deducted.