ERPNext Accounting
What is Tax Withholding (TDS/TCS)?
- Tax Withholding (TDS/TCS)
- ERPNext's Tax Withholding Category automates TDS and TCS deductions on applicable purchase invoices and sales invoices as per Indian Income Tax rules.
Configuring Tax Withholding Categories
Go to Accounting → Tax Withholding Category. Define the section (194C, 194J, 194Q, etc.), threshold amounts, and rates for PAN/non-PAN scenarios. Assign the category to the Supplier master to auto-apply on purchase invoices.
TDS Entry and Challan
ERPNext deducts TDS on submission of the invoice and posts it to the TDS Payable account. Use the TDS Payable Monthly report to view liabilities. Payment of TDS to the government is recorded via a Journal Entry against the TDS account.
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