Provision of income tax - tax liability as on the date of balance sheet
Manas Mitra (Service) (33 Points)
12 November 2016Manas Mitra (Service) (33 Points)
12 November 2016Expenses are reported in profit and loss account. Income tax is an expense, hence, it is reported. But, at what value! At total amount, the entity incurs. That total amount consists of taxes you pay and taxes someone else pays on your behalf in the name of TDS. So, the TDS or advance tax is your expense.
In the balance sheet, provision for tax (which has credit balance) is reduced by the amount of TDS and advance tax (that have debit balances), and shown as a liability.
Input Tax Credit, GST refunds and Recovery of refunds- Roadblocks and way outs
GST LIVE Certification Course - 43rd Weekdays Batch(With Govt Certificate)