Payroll Tax

Code: 2136
👁 Views: 156

Account Information

Financial Statement Statement of Financial Position
Normal Balance Credit

Definition

Payroll taxes owed by employees and transferred to government authorities

Common Journal Entries

Deduct income tax from salary

Dr. Salaries Payable
Cr. Payroll Tax

Pay payroll tax to tax authority

Dr. Payroll Tax
Cr. Bank Account

Adjust payroll tax after review

Dr. Tax Expense
Cr. Payroll Tax

Refund excess payroll tax

Dr. Bank Account
Cr. Payroll Tax

Deduct income tax from salary

Dr. Salaries Payable
Cr. Payroll Tax

Pay payroll tax to tax authority

Dr. Payroll Tax
Cr. Bank Account

Adjust payroll tax after review

Dr. Tax Expense
Cr. Payroll Tax

Refund excess payroll tax

Dr. Bank Account
Cr. Payroll Tax

📐 IFRS vs US GAAP Accounting Treatment

IFRS IAS 19 Employee Benefits
US GAAP ASC 710 Compensation - General

❓ Frequently Asked Questions

Q: What is payroll tax?

A: A tax imposed on employee salaries, withheld by the company and remitted to tax authorities.