1. Country-Specific Features
  2. India Help Topics
  3. India Localization SuiteTax Engine
  4. Tax Collection at Source
  5. Setting up Tax Collection at Source

Setting up Tax Collection at Source

To set up Tax Collection at Source (TCS), configure the customer and item records that are eligible for TCS and create TCS tax rate rules. To complete TCS setup, perform the following steps in the order specified:

  1. Configuring Customer Records that are Eligible for TCS

  2. Configuring Item Records for TCS

  3. Creating TCS Tax Rate Rules

TCS Subsection Codes

The India Localization SuiteTax Engine SuiteApp supports the following subsection codes under TCS:

The SuiteApp includes the default challan codes associated with each subsection code. In the global Search field, enter TCS Subsection to view the list of subsection codes, and enter TCS Challan to view the list of challan codes.

You cannot create section codes or subsection codes but you can create challan codes using the steps mentioned in To create a new challan code:.

Configuring Customer Records that are Eligible for TCS

You must configure the customer records that are eligible for TCS to ensure TCS calculation on transactions associated with the customer.

To configure a customer record for TCS:

  1. Go to Lists > Relationships > Customers.

  2. Click Edit beside a customer.

  3. Click the Financial subtab.

  4. Check the TCS Eligibility box.

  5. (Optional) In the Permanent Account Number (PAN) field, enter PAN.

  6. (Optional) In the Aadhar Number field, enter the Aadhar number.

  7. (Optional) In the Tax Exemption Certificate field, enter the tax exemption certificate number.

  8. Click Save.

Configuring Item Records for TCS

You must configure the item records that are eligible for TCS to ensure TCS calculation on those items when they are selected in a transaction.

To configure an item record for TCS:

  1. Go to Lists > Accounting > Items.

  2. Click Edit beside an item.

  3. Click the Accounting subtab.

  4. Check the TCS Eligibility box.

  5. In the TCS Subsection Code field, select a TCS subsection code.

  6. In the TCS Challan Code field, select a TCS challan code.

  7. Click Save.

Creating TCS Tax Rate Rules

After setting up TCS in customer and items records, you must create TCS tax rate rules to calculate tax.

To create a TCS tax rate rule:

  1. Go to Setup > India Localization > TCS Tax Rate Rules.

  2. Enter a name for the rule.

  3. Enter description.

  4. In the Customer Type field, select a customer type.

  5. In the Subsection Code field, select a subsection code.

  6. In the Challan Code field, select a challan code.

  7. Check the PAN or Aadhar Available box if either PAN or Aadhar is available for the customer.

  8. In the Effective From field, enter the start date of the tax rule's validity.

  9. In the Valid Until field, enter the end date of the tax rule's validity.

  10. In the Threshold Amount field, enter the threshold amount.

  11. In the Rate field, enter the tax rate that applies to the rule.

  12. Click Save.

When you select an item in a transaction, the SuiteApp uses the subsection code and challan code associated with the item to determine the tax rule. TCS is calculated based on the TCS tax rule applicable to an item. If you do not set the subsection and challan codes for an item, you cannot calculate TCS for an item.

If you want to create a new challan code to associate to an item, complete the following steps:

To create a new challan code:

  1. In the global Search field at the top of any NetSuite page, type New Challan Code.

  2. Enter a name for the challan code.

  3. In the Subsection Code field, select a subsection code.

  4. Click Save.

After completing the setup, you can calculate TCS on transactions. For more information, see Applying TCS on Transactions.

Related Topics

General Notices