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https://help.tallysolutions.com/docs/te9rel60/Tax_India/TDS/TDS_on_Transport.htm

Accounting for TDS on Transport

You can create an accounting voucher for transport-related expenses, along with the applicable TDS.

Section 194C of Income Tax Act is amended to include TDS deduction of 1 % for individuals and Hindu Undivided Families owning more than 10 goods carriage, and at the rate of 2% in case of other payees. For others not owning more than 10 goods carriage at any time during the previous financial year, and who has furnished a declaration to this effect along with his PAN, no TDS is applicable.

Note: A TDS of 20% is applicable for parties without a valid PAN.

Scenario: Rekha Traders availed transportation services from ABC Transporters (owns more than 10 goods carriers) on 24-4-15 on which a TDS of 2% is applicable.

To create a journal voucher

1.    Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2.    Click F2: Date to change the date to 24-4-2015.

3.    Debit Transport Expense ledger, by 50000.

4.    Credit ABC Transporter, amount is automatically filled.

5.    Enter the required details in the Bill-wise Details screen.

6.    Press Ctrl+A to save.

7.    Credit TDS ledger, amount is automatically filled.

8.    Enter Narration, if required.

The journal voucher appears as shown below:

9.    Press Ctrl + A to save the voucher.

Scenario: Rekha Traders availed transportation services from XYZ Transporters (owns less than 10 goods carriers) on 28-4-15.

To create a journal voucher

1.    Go to Gateway of Tally > Accounting Voucher > F7: Journal.

2.    Click F2: Date to change the date to 28-4-2015.

3.    Debit Transport Expense ledger, by 30000.

4.    Credit XYZ Transporters, amount is automatically filled.

5.    Enter the required details in the Bill-wise Details screen.

6.    Press Ctrl+A to save.

7.    Enter Narration, if required.

The journal voucher appears as shown below:

8.    Press Ctrl + A to save the voucher.