banner_ad

Provision/Expenses Payable

Others 777 views 8 replies
Hi,

While preparing financial I am confused in presentation of labour cess payable and External development charges payable, both are the estimated liability.

I am confused in presentation above expenses as expenses payable or provision? please let me know the correct treatment and as per income tax act this will be allow or not?
Replies (8)
43B applies to tax duty and cess i.e they are allowed only of actually paid before ITR due date.

labour cess = 43B applies, income tax allows only if u have actually paid irrespective of the fact whether shown as expenses payable or provision.

redev charges = i am unclear as to its exact nature. if they are NOT tax/duty/cess, it can be claimed on accrual basis. may be shown as provison/exp payable
Development charges are not taxes in nature, but if we would show this expense as provision, will it be disallow?
Development charges can be shown as expenses payable and this can be allowed under income tax but labour cess payable can only be allowed under income tax if the same has been paid during the year before return filling date u/s 43 b
Labour Cess payable (it's outstanding expenses) and it's allowable in income tax if is paid off before due date of filing return (under 43B) or in next FY if not paid off. Labour Cess is actual liability and how can it be estimated liability ?

Note that here under 43B due date means 30th Sept and not extended due date 31st Oct 2019

What type of External Development charges ?
Is it revenue expenditure or capital expenditure ?

pl clarify for appropriate reply.
It's revenue expenditures
Then make a provision or to expenses payable for External Development charges.

If such expenses are payable to Govt Bodies then it may not be Allowable under 43B
Yeah it's payable to government body, government body dues covered u/s 43b
Originally posted by : Pankaj Arora
Hi, While preparing financial I am confused in presentation of labour cess payable and External development charges payable, both are the estimated liability. I am confused in presentation above expenses as expenses payable or provision? please let me know the correct treatment and as per income tax act this will be allow or not?

 

Provision and Payable, both are liabilities. Provisions are estimated liabilities whereas Payables are fixed amounts.

 


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
ARTICLESHIP 17 May 2026
CA Article /Trainee

Malik Sunil & co

New Delhi

CA Foundation

View Details
Company
29 May 2026
Company Secretary - Part time

Shaswat initial support private limited

Ahmedabad

CS

View Details
Company
24 May 2026
Accounts & Tax Executive

PARAS KHURANA AND CO

New Delhi

B.Com

View Details
Company
29 May 2026
Finance Head

Bhawar Sales Corporation

Chennai

Graduate (Any)

View Details
Company
14 May 2026
Senior Associate

ABHISHEK SHANKAR AGARWAL & ASSOCIATES

Kolkata

CA

View Details
Company
ARTICLESHIP 14 May 2026
CA ARTICLE

PRAVEEN GARG & CO

Faridabad

CA Foundation

View Details
Company
18 May 2026
MIS Executive

Primarc Pecan Retail Limited

Mumbai

B.Com

View Details
Company
22 May 2026
Sr. Financial Analyst - Consolidation

Search Synergy

Mumbai

CA

View Details