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Set up TDS

TDS is set up in four places: the TDS type (revenue code), the TDS master (rate and payable ledger for each kind of supplier), a TDS type on each expense ledger, and the supplier's type and tax type. The rate used is found from all of them together.

  • Accounting TDS
  • 5 min read
  • Updated October 20, 2026

For Accountant

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What has to be set up

TDS (tax deducted at source) is tax you hold back from a payment for a service and pay to the tax office. For Penahak to work out the rate and book it, four things must be in place:

SetupWhereWhat it says
TDS typeTDS setting page > TDS typeA Revenue code and a TDS type detail (what the payment is for)
TDS masterTDS setting page > TDS masterThe Percentage and the TDS payable ledger for a TDS type, a supplier type and a tax type
The expense ledger's TDS typeGeneral ledger (the expense account)Which TDS type applies to payments booked to that expense
The supplier's Supplier type and Tax typeThe supplier (Create a supplier)Whether the supplier is personal, private, proprietorship or limited, and has a PAN or a VAT number or none

The rate that applies is the master that matches the expense ledger's TDS type and the supplier's type and tax type.

Set up the TDS types

  1. Open the TDS setting page
    Who
    Accountant
    Where
    TDS Setting (menu), then the TDS type tab
    What changes
    The list of TDS types.
  2. Add a type
    What changes
    Choose Add (Add TDS type). Enter the Revenue code and the TDS type detail (what the payment is for).
    Needs
    Both are required, and neither may repeat one you already have.
  3. Save
    What changes
    "TDS type saved successfully"

Set up the TDS masters

  1. Open the TDS master tab
    Who
    Accountant
    Where
    TDS setting page > TDS master
    What changes
    The list of rates, with the TDS Name, Description, Percentage, TDS Ledger, Customer type, Tax type and TDS type.
  2. Add a master
    What changes
    Choose Add (Add TDS master) and choose the TDS type detail. The window lists the masters that type already has; add a row for each new combination with a TDS Name, a Description, the General ledger (your TDS payable ledger), the Percentage, the Customer type (the supplier type) and the Tax type.
    Needs
    Every field except Customer type is required.
  3. Save
    What changes
    "TDS master successfully saved". The saved list becomes the type's masters.

Make one master for each combination you deduct on. For example, a rent payment to a PERSONAL supplier with a PAN may have one rate and the same payment to a LIMITED company another. The values for Customer type are PERSONAL, PRIVATE, PROPRITORSHIP and LIMITED; the values for Tax type are PAN, VAT and NONE.

Mark the expense ledgers

On the General ledger screen, open the expense ledger (an account in an expense group) and choose its TDS type. The ledger is then marked as one that needs TDS: a journal voucher line for it will offer the TDS fields (Deduct TDS when you book or pay an expense). Only a ledger in an expense group can be marked.

Fill the supplier's types

On the supplier choose the Supplier type and the Tax type (Create a supplier). Without them no TDS master matches.

Check it works

Make a trial journal voucher with an expense ledger and the supplier (Deduct TDS when you book or pay an expense): the TDS payable ledger, TDS amount and Net pay after TDS should fill in. If they stay empty, one of the four setups is missing: no master matches that expense ledger's TDS type with that supplier's type and tax type.

Common questions

The TDS fields do not show on my journal voucher.

The expense ledger has no TDS type, or it is not in an expense group.

The TDS fields show but are empty.

No TDS master matches. Check the expense ledger's TDS type, and the supplier's Supplier type and Tax type, against the masters.

Two masters with the same name.

Edit refuses a name or description that another master already uses, and the Add TDS master window treats a row with the same name and description as the same master. Add the supplier type to the name, for example "Rent - Personal PAN".

I changed a percentage. Does it change old vouchers?

No. A voucher keeps the percentage it was made with.

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