Double-Entry for Corporation tax


R

Robert

Hi,

I am unsure of what Journal should be carried out at year-end for Corporation
Tax. I am tempted to treat it like an expense in the Profit and Loss, but this
is not correct due it not being an expense.

Any ideas?
 
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P

Peter Saxton

Hi,

I am unsure of what Journal should be carried out at year-end for Corporation
Tax. I am tempted to treat it like an expense in the Profit and Loss, but this
is not correct due it not being an expense.
It is an expense.
Any ideas?
Dr Corporation tax (P&L a/c)
Cr Corporation tax creditor (B/S)
 
M

Mike Lewis

Robert said:
Hi,

I am unsure of what Journal should be carried out at year-end for Corporation
Tax. I am tempted to treat it like an expense in the Profit and Loss, but this
is not correct due it not being an expense.
It will feel like an expense when you write the cheque.
 
M

Matondo Lameck

corporate tax is not an expense, it is an appropriation so
Dr. P&L Appropriation (I&E)
Cr. Corporate Tax (BS - Liab.)
Being Corporate Tax Provisional / [Final] Assesment

if paid
Dr. Corporate Tax (BS - Liab.)
Cr. Bank/Cash
Cheque No. 0000000102023j - Bank payment for Corporate Tax Instalments

the Balance their after to be treated as an Amount Payable for Balance Sheet
and Financial Statements expression.

Enjoy the Day, for more more ..... (e-mail address removed).

url:http://myreader.co.uk/msg/12924380.aspx
 
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Corporate tax

DR Profit & Loss
CR Income Tax Expense
followed by
DR Income Tax Expense
CR Income Tax Payable
NB: Income Tax Expense could also include Deferred Taxation element} therefore the above entry would then be as follows:
DR Income Tax Expense
CR Income Tax Payable
CR Deferred Tax


and the last step is as follows
DR Income Tax Payable
CR Bank


Emmanuel K.L. Nemaungwe
 
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On Thu, 07 Jun 2007 09:33:57 +0100, Robert <robert@email> wrote:

>Hi,
>
>I am unsure of what Journal should be carried out at year-end for Corporation
>Tax. I am tempted to treat it like an expense in the Profit and Loss, but this
>is not correct due it not being an expense.
>

It is an expense.

>Any ideas?


Dr Corporation tax (P&L a/c)
Cr Corporation tax creditor (B/S)

--
Peter Saxton from London
(e-mail address removed)
Hi Peter,
I seriously Doubt about corporation tax as an Expense....!! Any eligible expense is deductible from Profit before it calculate the Corporation Tax Liabilities in the end. I have never come cross that Corporation tax was deducted from Net Profit before calculating the CT. Thanks
 
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Corporate tax

DR Profit & Loss
CR Income Tax Expense
followed by
DR Income Tax Expense
CR Income Tax Payable
NB: Income Tax Expense could also include Deferred Taxation element} therefore the above entry would then be as follows:
DR Income Tax Expense
CR Income Tax Payable
CR Deferred Tax


and the last step is as follows
DR Income Tax Payable
CR Bank


Emmanuel K.L. Nemaungwe
It is well confusing answer over the topic.
 
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I really thought that this forum is good place to interact and use as learning Sources. But I am really surprised that few people are replying anything without enough knowledge on the subject. This is so misleading.... Wish people would not just ASSUME for the ANSWERS. Thank you
 
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Becky

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You know you are replying to a 9 year-old archived topic... right?
 

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