India TDS and TCS (Extended Withholding Tax)

Lessons in this topic

• FICO India TDS Part 1: Extended Withholding Tax — Types, Codes and Section CodesLearn how TDS works in India and how SAP models it with extended withholding tax: withholding tax types for invoice versus payment, tax codes per section and rate, recipient types, section codes per TAN, and vendor master settings.
• FICO India TDS Part 2: Postings, Advances, Thresholds and ExemptionsFollow TDS through real postings: deduction on invoices, on advance payments and when advances are cleared, how threshold-based deduction works, and how lower or nil deduction certificates are applied.
• FICO India TDS Part 3: Challans, Certificates and Quarterly ReturnsComplete the TDS cycle: depositing deducted tax with a challan, updating challan details against SAP documents, issuing certificates to deductees, and preparing quarterly TDS returns that reconcile to the books.
• FICO India TDS Part 4: TCS on Sales and Managing Annual Rule ChangesUnderstand tax collected at source on specified sales, how it is configured with customer-side withholding tax, how it interacts with TDS on purchases of goods, and how to manage the yearly Finance Act changes safely in SAP.

Interview questions covered

• How would you configure TDS in SAP for a company paying contractors and professionals in India?
• How do you prevent double TDS deduction on vendor advances in SAP?
• Describe the monthly and quarterly TDS process in SAP and the controls you would put in place.
• How do you manage TDS and TCS changes from a new Finance Act in SAP?

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