TCS on Goods Sold | Tax Collected at Source on Sales under GST | How to create an invoice with TCS? TCS 0.1 percent and TCS 0.075 percent

The new provisions of TCS have come into force with effect from 1 October 2020 and according to it if your turnover is more than 10 crores in the previous financial  year i.e. the year ended 31 March 2020, then this year you will have to collect and deposit TCS on your receipts from sale of goods from such buyers from whom you received more than Rs. 50 Lakhs as sale consideration during the current Financial year. The TCS is payable on the amount of receipt which is greater than 50 Lakhs and received after 1st. Oct. 2020. The rate of TCS is 0.1% and Presently due to corona Pandemic 25% discount has been given in this tax rate till 31 March 2021 and its effective rate is 0.075%.

Points to be considered:
1. Applicable if you have sold 50,00,000 and above to one buyer.

2. Earlier TCS was applicable on few goods only but as per the latest guidelines it will be applicable on everyone who sells above 50 Lakh to one buyer.

3. Applicable from Oct 1, 2020.

4. This entry will be on Receipt basis.

5. Further you need to ensure if the buyer has provided you with his PAN details or not.

Case 1: Buyer has provided his PAN number:
TCS@0.075% is to be charged.

Case 2: Buyer has not provided the PAN number:
TCS@0.1% is to be charged.

6.If your previous year transactions turnover is above 10 crore then only it is applicable upon you.

If you fall into the above mentioned criteria then you need do following additions into Book Keeper software:

1. Go to Settings > General Settings > Decimal Place (Amount): Change it to 4 or 5 digits

2. Go to All Accounts > Create New Tax Account     and type following account name and percentage.

Tax Account Name

Percentage

TCS@0.1% (on 28% Items)

Percentage: 0.128

TCS@0.1% (on 18% Items)

Percentage: 0.118

TCS@0.1% (on 12% Items)

Percentage: 0.112

TCS@0.1% (on 5% Items)

Percentage: 0.105

TCS@0.1% (on 0% Items)

Percentage: 0.1

TCS@0.1% (on 3% Items)

Percentage: 0.103

TCS@0.075% (on 28% Items)

Percentage: 0.096

TCS@0.075% (on 18% Items)

Percentage: 0.0885

TCS@0.075% (on 12% Items)

Percentage: 0.084

TCS@0.075% (on 5% Items)

Percentage: 0.07875

TCS@0.075% (on 3% Items)

Percentage:  0.07725

TCS@0.075% (on 0% Items)

Percentage:  0.075

Sample Screenshot:

3. Go to All Accounts > Create Tax Group     and type following group name and percentage.     (No need to create all groups, only groups which you need, to be created)

For TCS 0.075%

Tax Group Name

Tax Account1

Tax Account2

Tax Account3

GST@0.075%

CGST@0%

SGST@0%

TCS@0.075% (on 0% Items)

GST@3.07725%

CGST@1.5%

SGST@1.5%

TCS@0.075% (on 3% Items)

GST@5.07875%

CGST@2.5%

SGST@2.5%

TCS@0.075% (on 5% Items)

GST@12.084%

CGST@6%

SGST@6%

TCS@0.075% (on 12% Items)

GST@18.0885%

CGST@9%

SGST@9%

TCS@0.075% (on 18% Items)

GST@28.096%

CGST@14%

SGST@14%

TCS@0.075% (on 28% Items)

IGST@0.075%

IGST@0%

TCS@0.075% (on 0% Items)

IGST@3.07725%

IGST@3%

TCS@0.075% (on 3% Items)

IGST@5.07875%

IGST@5%

TCS@0.075% (on 5% Items)

IGST@12.084%

IGST@12%

TCS@0.075% (on 12% Items)

IGST@18.0885%

IGST@18%

TCS@0.075% (on 18% Items)

IGST@28.096%

IGST@28%

TCS@0.075% (on 28% Items)

For TCS 0.1%

Tax Group Name

Tax Account1

Tax Account2

Tax Account3

GST@0.1%

CGST@0%

SGST@0%

TCS@0.1% (on 0% Items)

GST@3.103%

CGST@1.5%

SGST@1.5%

TCS@0.1% (on 3% Items)

GST@5.105%

CGST@2.5%

SGST@2.5%

TCS@0.1% (on 5% Items)

GST@12.112%

CGST@6%

SGST@6%

TCS@0.1% (on 12% Items)

GST@18.118%

CGST@9%

SGST@9%

TCS@0.1% (on 18% Items)

GST@28.128%

CGST@14%

SGST@14%

TCS@0.1% (on 28% Items)

IGST@0.1%

IGST@0%

TCS@0.1% (on 0% Items)

IGST@3.103%

IGST@3%

TCS@0.1% (on 3% Items)

IGST@5.105%

IGST@5%

TCS@0.1% (on 5% Items)

IGST@12.112%

IGST@12%

TCS@0.1% (on 12% Items)

IGST@18.118%

IGST@18%

TCS@0.1% (on 18% Items)

IGST@28.128%

IGST@28%

TCS@0.1% (on 28% Items)

Sample Screenshot:

To know how to create Tax Account and Tax Group, refer to the below link:
How to create Tax Group | GST@1 | GST@0.25 | CGST+SGST 

4. Create Invoice and apply these newly created Tax Groups if you wish to apply TCS:

5. (Optional) If you wish to verify TCS amount,

        Find total taxable value/subtotal + tax value    (40500+11200+90 = 51790)

        and then calculate 0.075% on it         0.075% of 51790 = 38.84

        Total TCS should be 38.84

Note:

As you can see that TCS 0.1% is computed on Subtotal + CGST + SGST. Follow below steps to create this invoice:

1. Create a new tax account 'TCS', mention percentage as 0.118 instead of 0.1% because this 0.1% is computed on net value after CGST and SGST. So, after considering the tax percentage of these two accounts (9% + 9%), we have mentioned percentage as 0.118%

2. Create a new Tax Group 'GST@18% + TCS' with SGST@9%, CGST@9% and TCS

3. Select this tax group while creating the invoice.