18 October 2009
y tds appearing in opening balance sheet is adjsuted by debiting partners capital a/c in assessment year can it be adjsuted with income tax liability if so mention entries
19 October 2009
Its a direct taxes & income tax does not allow the direct tax expenditure in profit & loss account. Now after the year end adjustment keeping the tds & advance income tax in current assets for years to years does not give the true & fair value of balance, so dr. TDS & advance tax to partners capital account.
In case you wish to dr. this to profit & loss account then you can do this ultimate effect will go to capital accounts. And add back such dr. while computing the taxable income.
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