Payment of taxes by company

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1359 Points Posted on 29 December 2022
how company record the payment of taxes and in which account it is debited p&l a/c or any other??
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On 29 December 2022 at 20:21 Report
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Quick Summary
This discussion clarifies how companies record tax payments. It explains that tax payments are typically debited to 'Current Tax' and credited to 'Tax Payables'. The conversation also touches upon GST accounting, differentiating between input and output GST, and clarifies that purchase accounts are not directly debited for tax payments, especially concerning direct taxes.

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My grammar is 💯 good I
7306 Points Posted on 29 December 2022

DR CURRENT TAX

CR TAX PAYBLES

AND 

PURCHASES DR

GST DR

TO PAYABLES CR

AND

BANK DR

GST CR

SALES CR

OUTPUT GST-INPUT GST = GST PAYABLE IT SEEMS

UNTIL YOU DO THE ABOVE FORMULA DURING FINALISATION

"Input GST is current assets and output GST is current liabilities"

 

 

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On 29 December 2022 at 20:59
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Profession Business
28246 Points Posted on 29 December 2022
Purchase account will not be debited.
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On 29 December 2022 at 21:19
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1359 Points Posted on 30 December 2022
I am asking about direct tax
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On 30 December 2022 at 17:02

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