Accounting of income tax

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Querist : Anonymous

Querist : Anonymous (Querist)

01 September 2011 Plz tell me accounting entries of following:-

Income tax payable 500000/-
Advance Tax 100000/-
TDS Deducted 50000/-
Net Income tax payable 350000/-

I have a query whether in accounts provision for made for the full amount i.e.Rs.500000/- without adjusting advance tax and TDS.and if yes adjustment entries when is required to be passed whether after final payment of tax and whether in finalised bal. sheet this adjustment entry to be considered.Pls reply

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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01 September 2011
Opinion differs in this issue. I used to book full provision (Rs. 5 laks) and full provision and adv. tax /tds is showing separately in B/S.

Querist : Anonymous

Querist : Anonymous (Querist)

01 September 2011 Sir plz tell me that if it is the case then provision and the amount of tds,advance tax always stand..and carry forward year to year......then what is the solution....

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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01 September 2011 After the completion of the income tax assessment, provision will be set off against adv tax /tds / self assessment tax. Till that time, gross figures will appear in both sides of the b/s.

Querist : Anonymous

Querist : Anonymous (Querist)

01 September 2011 ok sir plz tell also that after the assessment adjustment entry in which year will be passed if balance sheet signed then what would be the scenario???

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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01 September 2011 Squre up entry should be booked in the financil year determined in accordance with the date of receipt of the assesment order.

Querist : Anonymous

Querist : Anonymous (Querist)

12 April 2012 BY the assessment whether it means u/s 143(3) but scrutiny assessment of every co. is not mandatory.......please tell me the date when adjustment entry of provision of income tax to be adjusted against tds and advance tax paid....

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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12 April 2012 Either on completion of assessment under section 143(3) or intimation u/s 143(1) crystallizes as an assessment order by virtue of time limit expiry to issue notice u/s 143(2).

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