Rashmi (article assistant) (32 Points)
08 September 2011is it comulsory to make provision for tax ......if we get refund in case after adjustment of advance tax...kindly reply
if our tax liab is say 100000 n our advance tax paid is 125000 den still do we need to make provision for tax in our books of accounts ..kindly rep wid an reason
Maulik Savani
(PRoprietor)
(28 Points)
Replied 08 September 2011
Rashmi
(article assistant)
(32 Points)
Replied 08 September 2011
arey bt in above case wat will happnd???
C.A. Sandeep Wawhal
(CA, PGDFM, BCom)
(1831 Points)
Replied 08 September 2011
It is better to make provision as per merchantile accounting system.
Maulik Savani
(PRoprietor)
(28 Points)
Replied 08 September 2011
Ravi Jhamb
(Accountant Officer)
(677 Points)
Replied 08 September 2011
Provision is made for the payment of upcoming liablity which are not defined (assume). In your case you have already paid the advance tax in excess amount . it will treated as Current Assets and adjust next accounting year tax liablity.
CA Anjali Aswal
(CA)
(215 Points)
Replied 08 September 2011
you have to make provision for taxation for the tax liability on 31st march. Also on the same date Advance Tax would be standing in assets side of the balance sheet. In next year i.e. on 1st April when you will set off the amount of provision and Advance Tax the balance will stand as Refund of Income Tax.
Entry on 31st March
Profit & Loss A/c Dr. 100000
Cr. Provision for TAxation 100000
Entry on 1st April
Provision for Taxation Dr. 100000
Refund of Income Tax Dr. 25000
Cr. Advance Income Tax 125000
Its all what I think should be the accounting treatment.
Any corrections plz reply.
Rashmi
(article assistant)
(32 Points)
Replied 08 September 2011
THANK YOU ALL
FOR U R VALUABLE RELPY
AND CAN PPL HELP ME K FOR WHOM 3CA IS APPLICABLE N FOR WHOM 3CB IS APPLICABLE I READ THE BARE AT BT CANT UNDESTAND PROPERLY
C.A. Sandeep Wawhal
(CA, PGDFM, BCom)
(1831 Points)
Replied 08 September 2011
3CA is applicable to LTD companies and 3CB is applicable other than LTD Companies.
CA Anjali Aswal
(CA)
(215 Points)
Replied 08 September 2011
3CA is for corporate assesee and 3CB is for non corporate assessee eligible for Tax Audit u/s 44AB
Rashmi
(article assistant)
(32 Points)
Replied 08 September 2011
BT WAT ABT PVT N PUBLIC LTD COMPANIES????
CA Anjali Aswal
(CA)
(215 Points)
Replied 08 September 2011
PVT Ltd and Public ltd are corporate assessee
valji
(Accounts manager-MBA)
(2150 Points)
Replied 08 September 2011
it is not compulsory but for accounting system it is better to make
CAclubindia
