Professional Fees

Professional Fees covers audit, legal, tax consultancy, software consultancy and similar expert services. Nepal taxes these at source: the company withholds 1.5 percent if the consultant is VAT registered and 15 percent if not, deposits it by the 25th of the next month and issues the certificate; without the deduction the fee is disallowed and the company bears the tax. In BRAccount the consultant is a Supplier with the matching Nepal TDS - Consultancy category, so the Purchase Invoice posts the gross fee here and credits TDS Payable and Creditors for the net. The year's audit fee is usually accrued at Ashadh end through Accrued Expenses before the bill arrives. VAT charged by a registered firm is claimable.

TDS on fee = Gross fee x 1.5 percent (VAT registered) or 15 percent (not registered); net payable = Gross - TDS

1. 01Go to Buying > Supplier, open the consultant, and set the Nepal TDS - Consultancy category that matches their VAT status.
2. 02Go to Buying > Purchase Invoice > New, pick the supplier and post the fee to Professional Fees.
3. 03Add VAT 13% - YFF if the firm's bill shows it; the TDS row is added automatically.
4. 04Submit. The entry below posts.
5. 05Pay the net with Create > Payment Entry and deposit the TDS by the 25th of the next month.
6. 06Issue the TDS certificate to the consultant from the E-TDS portal.

Post by Purchase Invoice with TDS withheld to TDS Payable. Accrue the audit fee at Ashadh end if not yet billed.

Dr Professional Fees Rs 50,000, Cr TDS Payable Rs 7,500, Cr Creditors Rs 42,500 for the FY 2083-84 audit fee.