Provision for income tax

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629 Points Posted on 16 January 2021
Sir,

Please suggest below entry in books of account is correct or wrong in proprietor firm

Provision for income tax (Capital Ac)
Provision for income tax (current liability)
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On 16 January 2021 at 08:54 Report
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Quick Summary
This discussion clarifies the correct accounting treatment for income tax provisions in a sole trader's books. It addresses whether to record it as a capital item or a current liability. The consensus is that income tax provision should be shown under current liabilities, and creating a separate 'provision' entry is generally unnecessary and potentially confusing.

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Chartered Accountant
24588 Points Posted on 16 January 2021
Provision for Income tax is shown under
Current liabilities
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On 16 January 2021 at 09:14
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Profession
28261 Points Posted on 16 January 2021
Provision for Income tax is shown under


Current Liabilities and Provision.
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On 16 January 2021 at 09:44
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Accountant
4533 Points Posted on 16 January 2021
Kindly elaborate for what u want to pass entry.
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On 16 January 2021 at 11:25
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Chartered Accountant
86505 Points Posted on 18 January 2021
No need to make such entry as it is useless.
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On 18 January 2021 at 09:16

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