Plz pass this journal entry

Hello,

With refference to ur query aabout Provision for taxation for Rs.23000

 first let us discuss about the what entry would be passed for above said transaction

                                          1) Income tax a/c  Dr 23000

                                                             To Provision for taxation a/c 23000

                               (being provisin for taxation for the yerar.)

Then come to advance paid for 20000 

                          Jv entry    ----     2)    prepaid/advance tax  Dr a/c     20000

                                                               To Tax a/c                                         20000

                                      3) P& L a/c Dr        20000

                                                To Income tax a/c             20000

Final  entry would be for left out balance i.e., for 23000-20000=3000 it remains back in balance sheet as liablity for the year.            4)  income tax a/c Dr   3000

                                                                  to  Provision for tax                  3000

                                   (being leftover balance for Rs.23000-20000 = 3000)

I conclude.

Hari prasad.J

Sir, Normally, when we get the asst. order from IT dept, we have to pass the jv. In this asst order we will come to know whether we have to remit balance tax or refund. At that time, we have to open an a/c called IT REFUND ORDER a/c. The provision for taxation a/c should be debited and it refund order is to be credited. The Income tax remitted is to be credited and IT refund order a/c is to be credited. By seeing the asst order we will know, the 234a and 234b interest has been collectged by it dept or interest has been paid for refund to us. That should be entered in P&l a/c as the case may be. Balance should be tallied. if you want to clear fully. send he details to chith1954 @ gmail.com. >>>>sent b y sekar.