Hello Friends,
A Corporate client of mine has received Income Tax Refund. Can someone please let me know the accounting entry to be passed.
Ryan Lasrado (CEO) (96 Points)
18 August 2011Hello Friends,
A Corporate client of mine has received Income Tax Refund. Can someone please let me know the accounting entry to be passed.
praveen kumar devarapalli
(Managing Director)
(361 Points)
Replied 19 August 2011
Dear Ryan, Check the accounting entries passed in the previous financial year for Refund receivable the entry might be like this.
Ex. IT Payable is Rs. 75,000/- TDS deducted amount is Rs. 1,00,000/-
Income Tax A/c....................................Dr 75,000
To TDS revceived A/c 75,000
If the entry is like above you have to pass the entry as follows
Bank A/c....................................................Dr 26,125
To TDS Received A/c 25,000
To Interest on IT Refund A/c(if any) 1,125
CA.B.Sivakumar
(-)
(162 Points)
Replied 19 August 2011
Some companies will have TDS received amount and some may not.
In those cases the TDS received account is replaced either by Provision of incometax or Advance Tax.
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