Professional charges

Dear Sir/Ma'am,

My audtior asked me to make corrections in the professionall tax (PT)

Professional Tax must be accounted as current liability on salary Due Entry (Not as Expenses Ledger) on payment it need to be  debited Professional Tax Payable a/c & bank a/c to be credited( Professional Tax Should not to be shown as expenses since same has been collected from employees so Expenses of Rs 600 need to be adjusted by following Above Accounting Entry

Please can any one explain me with example.

Many thanks in advance.

Best Regards,

Anitha

 

 

Replies (1)

suppose if umake 10000 as a salsary to x employee

 salary a/c dr 9800

professional tax  dr 200                      journal  entry

to salary payable a/c  9800

to professional tax payblea/c  200

 

payment entry

salary payble a/c dr 9800

to cash/bank a/c          9800

professional tax payble a/c  200

to cash/bank                     200

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