Good Morning Everyone,
hope all doing well
My qurery is : "what will be the tax treatment , when we get advance payment from our debtor and billing done on next financial year".
will it included in turnover or else.
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Tax treatment for advance payment from debtor
Replies (2)
no it will not as advance received isn't your income. income would arise when actual sale is being booked against the debtor
Advance received shall be treated as income only in the year in which it is recognized. In our case, advance shall form part of turnover only in the year in which actual billing is done. This is irrespective of the fact that you follow a cash system or a mercantile system of accounting.
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