Dear Sir/Mam,
Our company has received Income Tax Refund.
Kindly let us know the treatment in Books of Account. Is it Income or Not?
Rajesh Kumar Loya (student) (177 Points)
25 September 2013Dear Sir/Mam,
Our company has received Income Tax Refund.
Kindly let us know the treatment in Books of Account. Is it Income or Not?
CA LOVELY ARORA
(C.A. B.Com (H) Graduate)
(2151 Points)
Replied 25 September 2013
Dear Sir,
Receipt of income tax refund is not an income in its own sense... however, if you receive interest on such refund.. then that would be constituted as your income under the head "income from other sources"... and
amount of refund will be net-off with the amount of refund receivable that was standing in your books as current assets.. that amount will be wholly set-off and above that amount i.e. interest is you income as said above.
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