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journal entry of paying advance tax from partnership firm

sadhanisa (student) (76 Points)

23 October 2016

what will be the journal entry when partners make payment their advance tax fy16-17 from their firm account? and what will be grouping head of advance tax in tally

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CA ABHAY GUPTA (Practice) (3235 Points)
Replied 23 October 2016

Dr Partners Capital Account
Cr Bank

being advance tax paid by firm on behalf of partners debited to their respective capital accounts.

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sadhanisa (student) (76 Points)
Replied 24 October 2016

million thanks sir

SUNEEL KUMAR (Sr. Accounts & Finance Executive) (163 Points)
Replied 26 October 2016

I AGREE WITH CA ABHAY GUPTA

Ruchi (CA) (1410 Points)
Replied 26 October 2016

In my opinion, you should not transfer the Advance Tax amount to the Partners Capital a/c now. Rather , you should create a Current Asset a/c for the same. At year end , after determination of total tax , etc. only you should transfer the total or net amount to the Partners Capital account.