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treatment of advance tax and provision for tax

This query is : Resolved 

07 April 2011 hi

I have one query regds advance tax and provision for tax

In trial balance advance tax paid 50000 and provision for tax 150000 is given

in adjustments

tax liabilites 200000

So some one could tell me accounting treatment and payment entries related to this


Thanks
Surender singh

07 April 2011 Till you receive the assessment order, do not do any adjustment.

07 April 2011 In ideal scenario : your provision for tax should match with your tax liability. But you are showing provision as 150000/- whereas tax liability at 200000/-.

Normally the adjustment entry is passed on receipt of assessment order.

Entry :

Provision for Tax Dr.
Self assessment Tax Cr.
Advance Tax Cr.




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