Income tax entry

1. P&L  A/c Dr.231679

      To Prov for tax 231679

2. TDS A/c Dr.721972

       To Client   721972(name of the person who deducted TDS )

3. Prov for Tax A/c Dr.231679

      To TDS                     231679

And finally when you will receive te refund, then

4. Bank A/c Dr.490290

      To TDS         490290

@ Nisha Yadav

I think you had carried forward the last year profit to "Profit & Loss account" opened under the head "Reserve & Surplus" i.e it represents the undistributed profits of the company. You can now debit the provision amount to that "Profit & loss Account".

In this case, you current year profits will not be effected and the provision would be automatically be deducted from reserve and surplus head. Later on, you can adjust the TDS and make an asset for Income Tax Refundable.

@ Nisha Yadav

(Sorry for delay reply)

1. In my opinion, it should effect last year profit.

2. For reserve & surplus, show the opening balance as per balance sheet and then deduct the provision amount as an item on appropriation of profits in notes to account.