What will be the treatment of Excess Income Tax Refund (including Interest on it) in the books of Assessee - Small trading concern & Co-operatie societies.
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It refund
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In anybody's books, treatment of income tax refund is as under:
Bank Dr
Income Tax Refund (capital item) cr
Interest on Income Tax Refund (Income) Cr
Same for all.
IT REFUND WILL BE ADDED BACK TO CAPITAL ACCOUNT. AND EXCESS REFUND WILL BE TREATED AS INTEREST ON IT REFUND AND WILL BE TAXABLE UNDER IFOS.
In anybody's books, treatment of income tax refund is as under:
Bank Dr
Income Tax Refund (capital item) cr
Interest on Income Tax Refund (Income) Cr
Same for all.
If Income tax refund is related to TDS recievable of previous years, it will be adjusted with it after passing above entry......
Income tax recd in excess shall be trated as Interest and shall be chargeble to tax..
hii, one of my client has given me form 16 in order his employer has deducted tds..now the issue is that his salary is not taxable..should he get the refund if i file nil return..and if yes how much time will it takes to get the refund?????
YOU WILL GET REFUND BY DECEMBER JANUARY I.E. 5-6 MONTHS MAX
thank sir.. one thing more i want to know that when will an individual gets refund along with the interest.
Interest u/s 244A is payable on refund from April to the date its actually paid for month or part of month.
but department does not give interest if refund arises out of self assessment tax.
hence interest is paid only if refund arises out of tds and advance taxes paid.
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