Accounting treatment of excess it refund received

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Pls tell me about Accounting Treatment of Excess IT refund received against IT Refund Receivable from earlier years......

means in which account I could Credit the Excess Income Tax Refund..................

Replies (5)

How can you receive the excess IT refund? There should be some error in filing IT Return. Please check the same.

the excess amount is Interest accured on refunds, and its taxable income.

If it is interest accrued, I agree with U S Sharma.

The excess amount should obviously be Interest amount. So the entry to be made is as follows:

 

Bank A/c                          Dr                                    xxxxx

    To IT Refund Receivable A/c                                       xxxxx

    To Interest on IT Refund A/c                                        xxxxx

 

The Interest on IT Refund is to be shown in P&L A/c as Indirect Income and the same is to be shown as Income From Other Sources in ITR

thanx all of u.................


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