accounting treatment
This query is : Resolved
08 June 2011
A ltd has paid service tax on income earned from business auxiliary services rendered by them during past few years. They had not accounted service tax liability in the books at the time of receipt. whether the payment can be treated as prior period expense in the current years financial statements?
what will be its treatment in computation of income tax?
what will be its treatment in computation of income tax?
08 June 2011
Since it has not been collected earlier so it will be cost to the company. And your sale received earlier should be considered as inclusive receipt. You can debit in PL account. For allowability u/s 37 it is condition thatit must be incurred during the year, in this case prior period service tax may be disallowed
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