Track tax deduction at source and certificate receivable, (customer invoice)¶
TDS stands for Tax Deducted at Source. It was introduced to collect tax at the source from where an individual’s income is generated.
The government uses TDS as a tool to collect tax in order to minimise tax e vasion by taxing the income (partially or wholly) at the time it is generated rather than at a later date.
TDS is applicable on the various incomes such as salaries, interest received, commission received, consulting or professional services, job-work, etc.
The My Company is a consulting company selling a professional consulting services their regular customer China Export. The customer will deducts the TDS @ 10% rate and make the payment against the bill.