Income Tax Payable

Code: 2157
👁 Views: 177

Account Information

Financial Statement Statement of Financial Position
Normal Balance Credit

Definition

Income tax owed by the company for the current financial year

Common Journal Entries

Accrue income tax

Dr. Income Tax Expense
Cr. Income Tax Payable

Pay income tax

Dr. Income Tax Payable
Cr. Bank Account

Pay income tax installment

Dr. Income Tax Payable
Cr. Bank Account

Adjust income tax after tax audit

Dr. Income Tax Expense
Cr. Income Tax Payable

Accrue income tax

Dr. Income Tax Expense
Cr. Income Tax Payable

Pay income tax

Dr. Income Tax Payable
Cr. Bank Account

Pay income tax installment

Dr. Income Tax Payable
Cr. Bank Account

Adjust income tax after tax audit

Dr. Income Tax Expense
Cr. Income Tax Payable

📐 IFRS vs US GAAP Accounting Treatment

IFRS IAS 12 Income Taxes
US GAAP ASC 740 Income Taxes

❓ Frequently Asked Questions

Q: How is income tax payable calculated?

A: Taxable net profit × Applicable tax rate (considering exemptions and allowable deductions).