provision for income tax for 2016 for intuit

To Interest Received (Income) A/C Rs 10000/. To simplify if interest received is Rs.9000/- and TDS deducted on that is Rs.1000/-, the total income would be Rs.10000/. Generally some tax is deducted at source from our income of interest or commission etc and we get net income. In case of self assessment tax also this entry is passed but the narration will be for self assessment. Advance Income Tax :Īs per Income Tax Act, we have to pay advance income tax and that is showed at “Property & Assets” side of Balance Sheet in the bracket of “Other Assets”. This provision being a liability, showed at “Capital & Liability” side of Balance Sheet in the bracket of “Other Liabilities”. Profit & Loss A/C DR (provision for income tax) On that taxable profit we have to make provision for income tax at prevailing rate of income tax. depreciation booked in books of accounts and depreciation allowable as per income tax rules) taxable income arrives.

After adjusting necessary items from gross profit, (e.g. Therefore, today I am covering some of the most important accounting entries and concepts related to income tax provision, TDS and advance tax.īefore going to understand the taxation entries, we should clear the various heads relating to Income Tax. The actual taxation entries are most important things as they clear the Balance sheet picture and gives real result. Hence everybody is focused on finalisation of their books of accounts. As we all know, we are at the end of our financial year.

Provision for income tax for 2016 for intuit