Hotel Accounting guide

TDS Deduction, Challans and 26Q for Hotels

TDS for hotels done right: dated section rates, yearly thresholds, lower-deduction certificates, monthly challans and the quarterly Form 26Q.

You deduct the right TDS, even after the law changes: typically 2% for contractors, 10% for professionals and 10% for rent. It is tax you withhold for the government from someone else's payment. Software that fixes "2%" in code goes wrong within a year, because Finance Act rates change, thresholds apply per section per financial year, and a lower-deduction certificate sets its own rate until it lapses.

How it works

Statutory rates and thresholds are stored with dates, and your own rows override them.
A lower-deduction certificate is stored with its validity dates.

The deduction is worked out from four inputs: section, bill amount, bill date, and the total paid to that party so far this year. That running total decides when the threshold is crossed, and the bill that crosses it also deducts what was missed on earlier bills.

Every payment is logged

Each section-wise payment is logged, deducted or not, so the yearly total is a sum, not a memory. Each month's challan has to match that month's accrual, and is due by the seventh. Form 26Q is produced each quarter in the utility's format.

TDS your customers deduct

TDS deducted from your bills is a receivable against your own tax. Form 26AS lists only the tax your customer actually paid in and reported, and you match against that alone.

Other Hotel Accounting guides

Double-Entry General Ledger Built for HotelsYour night audit posts straight into a double-entry hotel ledger, kept per company, with control accounts checked and no unbalanced journal allowed. Accounts Receivable and City Ledger for HotelsTrack hotel accounts receivable invoice by invoice: allocate receipts, record TDS and short payments, age debts and send reminders automatically. Vendor Payables With Three-Way Bill MatchingKeep one vendor master with PAN, GST, MSME and TDS details, and match each vendor bill to the GRN and purchase order before it becomes payable. Vendor Payment Runs With NEFT Bank FilesPay vendors in one run, MSME suppliers first, with an NEFT bank file, remittance advice, retention and advances handled, and a single journal. Bank Reconciliation and Cash Position for HotelsRun hotel bank reconciliation line by line from imported statements, manage the till float and petty cash, and see your cash position on one screen. Payment Gateway and OTA Payout ReconciliationReconcile gateway payouts and OTA remittances booking by booking, so card fees, OTA commission and the GST on it are posted, not lost. GSTR-1 and GSTR-3B Filing for HotelsPrepare GSTR-1 and GSTR-3B from your hotel's books in the portal's format, reconcile input credit with GSTR-2B, and file per GSTIN. GST E-Invoicing With IRN and Signed QRRegister hotel B2B e-invoices with the IRP automatically, print the IRN and signed QR, and cancel within 24 hours or issue a credit note. Export to Tally, Zoho Books and QuickBooksExport each day's accounts a single time to Tally, Zoho Books or QuickBooks, tracked as numbered batches, plus a signed webhook for other systems. Food Cost and Cost of Sales From Real ConsumptionSee true hotel food cost: cost of sales comes from what the kitchen consumed, not what was bought, and unused stock counts as an asset. Banquet Accounting, Package Splits and Deferred RevenueRun each event as its own ledger, hold banquet deposits as client money, split package rates for management accounts and defer unearned room revenue. Fixed Asset Register and Depreciation for HotelsKeep a hotel fixed asset register with tags and locations, two depreciation books, disposals, physical verification and capital work in progress. USALI Operating Statement With GOP and GOPPARGet the USALI operating statement owners and lenders expect, with departmental profit, GOP and GOPPAR, cash flow, KPIs and a column per hotel. Hotel Budget, Variance and Rolling ForecastBuild a hotel budget by account and month from occupancy, ADR and covers, approve it with two people, track budget vs actual and roll the forecast. Import Payroll Into Your Hotel BooksImport your monthly payroll by department, post one journal with PF, ESI, PT and TDS, then pay staff and each authority with a challan. Group Consolidation Across Your HotelsConsolidate P&L, balance sheet and trial balance for a hotel, a company or your whole group, plus an owner statement with equity, payouts and FF&E reserve. Foreign Currency Invoices and Month-End RevaluationInvoice overseas agents in foreign currency, keep the rupee value, and revalue open balances at month end with exchange gain or loss posted. Accounting Anomaly Alerts and Fraud ChecksDaily rule-based checks flag duplicate bills, odd journals, cashier voids, price drift, bad GSTINs and uncharged rooms; a person decides every alert. Month-End Close Checklist, Approvals and Daily Sign-OffLock each month only after a month-end close checklist passes, snapshot the trial balance, route sensitive actions for approval and sign off every day. Coming Next in Hotel AccountingThe hotel accounting roadmap: intercompany posting, multi-book and leases, bill OCR, plain-language questions and approvals on one workflow.