AS-22 Accounting Treatment Urgent Sir!!!

This query is : Resolved

Rajesh (Querist)
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03 September 2010 Dear Experts,
This is the first year where AS-22 Accounting for Taxes on income is going to be applied.
Fortunately i have been able to zero in the amount of difference. That is due to a provisional payment as per S.43B, which comes around 1 lakh.
It will be greatful for me if anyone can help me dealing in the following points.
1) How much amount i have to debit or credit in P&L account as Tax Expense or Tax Income.?
2) What is the entry to be passed in the above case?
3) How much amount i have to show it in Balance Sheet whether as Deferred Tax Asset or Deferred Tax Liability?
4) What is the entry to be passed in the above case?
Please explain me in detail...
With regards,
Rajesh.

CA SMR

CA SMR (Expert)
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04 September 2010 1)In the accounts, no entry to be passed against this 1 lakh,its only while calculating current tax,1 lakh has to be added back to arrive at taxable income.If 30 % is the rate of income tax then 30000/- has to be shown as deferred tax assets.
2)Deferred Tax Asset Dr 30000
To Revenue Reserve 30000
(provided there is reasonable certainty that sufficient future taxable income will be available against which this can be set off)

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