Question

post the journal entry-. Advance income tax paid. Rs.5000

Answer 1

Advance tax a/c Dr. 5000
To Bank a/c 5000

Answer 2

Meaning of advance tax

Advance tax is the income tax payable if your tax liability exceeds Rs 10,000 in a financial year. Advance tax should be paid in the year in which the income is received.

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3 golden rules

• debit the receiver , credit the giver

• debit what comes in , credit what goes out

• debit all the expenses and losses , credit all the incomes and gains

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reason for debit and credit

Advance tax - Nominal A/c , its the expense to the company , therefore its debited

Bank A/c - Personal A/c , where bank pays to income tax department , banks is the giver therefore its credited

* i assume its paid by bank because now a days all transactions becomes online .

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Journal Entry

Advance tax A/c Dr 5000

To Bank A/c 5000

(being advance tax paid)