Assigning Tax Deduction at Source Section Codes to Items and Accounts
After setting up TDS, you can assign default TDS section codes to items and accounts. The default section code for an item or account automatically populates in the India Tax Section Code field when you select the item or account in a transaction. If required, you can also override the default section code in a transaction.
The section code determines the TDS tax rate rule to apply to a transaction. You must complete Setting Up Tax Deduction at Source before assigning default section codes.
You can assign default section codes to items and accounts using the Administrator or India Tax Manager role only.
Assigning Default TDS Section Codes to Items
The India Localization SuiteTax Engine supports the following item types for TDS calculation. The section code assigned to an item is set as the default TDS section code for the item.
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Inventory Item
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Assembly Items
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Lot Numbered Item
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Serialized Item
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Item Group
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Non-Inventory Item (for purchase and for resale)
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Other Charge (for purchase and for resale)
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Service (for purchase and for resale)
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Matrix Item
To assign a default a TDS section code to an item:
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Go to Lists > Accounting > Items.
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To assign a section code to an item, click Edit beside the item.
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Click the Accounting subtab.
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Under the India Tax Information section, in the Section Code field, select a section code.
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Click Save.
Assigning Default TDS Section Codes to Accounts
You can assign default section codes to accounts. The section code assigned to an account is set as the default TDS section code for the account.
To assign a default TDS section code to an account:
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Go to Lists > Accounting > Accounts.
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To assign a section code to an item, click Edit beside the account.
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In the India Tax Section Code field, select the default section code for this account.
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Click Save.
After assigning TDS section codes to items and accounts, you can start calculating TDS on bills. For more information, see Applying Tax Deduction at Source on Vendor Bills.