Provision for income tax

This query is : Resolved 

09 August 2013

plz help me in making understand how to create provision for income tax in the books of a company .

and the treatment of advance tax .. TDS recievable in it.

CMA Ramesh Krishnan (Expert)
09 August 2013

Create ledger Income tax & provision for income

after computing the tax calculation

Dr: Income tax a/c
Cr: Provision for income tax account

create Advance tax & TDS receivable ledger under current assets

while paying advance tax only payment entry

Dr: Advance tax
Cr: Bank

TDS receivable when ever you are getting the deduction details from customers need to pass the entry

once final tax assessment order received

Dr: Provision for income tax
Cr: Advance tax
Cr: TDS receivable
Cr: Self assessment tax (if anything paid)

Ridham (Querist)
12 August 2013

thanku so mch sir..

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