Neelam
(Student CA Final,)
(116 Points)
Replied 20 June 2011
| Originally posted by : Disha Bhawnani | ||
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Today i was doing a company's tax audit and i noticed a journal entry which was as follows:- VAT Tax Payable A/c Dr. To Income a/c So i asked my senior about the same and he replied that it happens when people want to save or get rid of tax liability.. Please suggest whether the accountant was correct in passing such a journal entry.. Thanx in advance! |
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I think its okkkk,,,
it can b done for writting off small difference between VAT payable & actual vat paid amount,,
and taking the credit side aproach it may b indirect income or other income but not direct ,,,,
Neelam
(Student CA Final,)
(116 Points)
Replied 20 June 2011
then its wrong because no one can write off Govt, duties,,,
Is it paid ???
if not , then it should , no adjustment can b made,,
Neelam
(Student CA Final,)
(116 Points)
Replied 20 June 2011
and also have confirmation about it whether its a excess amount paid ????
| Originally posted by : Neelam | ||
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then its wrong because no one can write off Govt, duties,,, Is it paid ??? if not , then it should , no adjustment can b made,, |
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they escaped the VAT liability by nullifying the effect by passing this entry..
Neelam
(Student CA Final,)
(116 Points)
Replied 20 June 2011
as according to my practice My CA MIT never permitted for such adjustment with Govt. duties,,
you should present ur argument,,,,,,,
CA ADITYA SHARMA
(CA IN PRACTICE )
(16719 Points)
Replied 20 June 2011
vat tax payable is our liability to be paid to the government. how can we treat as income????????????????????
@*CS Siddharth Bumb. *
(B.Com, CA Final, CS )
(5270 Points)
Replied 20 June 2011
it is wrong entry... he did because to reduce VAT liability and he will adjust such income tax liability on last day may be he will trf to capital account..and will reduce income tax liability... i think you should trf this query to expert.. nice query... :-)
Rajnikant Vadigoppula
(CA, CS And CMA Final)
(919 Points)
Replied 20 June 2011
u can follow receipt or accrual basis.
in recept basis, expenses are considered when paid recognised as income in the year of receipt.
in accrual basis, input is adjusted agaist output then final amount will be payable/receivable.
CAclubindia
