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Payment of income tax notice
We have received a notice form income tax department for payable of Rs 8000
Now we have been paid the same amount 8000 to Income Tax dept.
Please suggest us for entries in accounts book.
Replies (9)
Dr. Taxes/Income Tax paid
Cr. Bank (or Cash)
Narration: IT Demand for Ass. Yr. 20xx-xx
AGREE WITH RAMBHIA SIR
AGREE WITH RAMBHIA SIR
BUT PLZ TELL US THE MAIN HEAD OF TAXES AND INCOME TAX PAID
I THINK THIS IS GOES TO CAPITAL HEAD
IF ANY HEAD PLZ TELL US
Income tax goes under Capital
However , for companies , income tax goes under profit and loss appropriation.
I THINK NOT GOES TO P&L , BECAUSE HE DEPOSIT I.T. AGAINST DEMAND NOTICE
As per finalized balance sheet this amount was not in our liability or provisions. but notice received us next year so may be it our extra Expenditure.
Please suggest amount will effect against capital account/indirect Expenses/profit & loss account.
For any Business entity It can be taken indirect expense, if its regular tax liability, but if its any sort of penalty or interest payment, debit it to capital account.
Thanks Sir
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