Accountancy, asked by Joysinha002, 1 year ago

Where does the income tax goes in final account

Answers

Answered by jerri
2
Hello Frnd

Since INCOME TAX is a tax which is paid on the Income of the entrepreneur which he earns from the business it's not a expense of business.

INCOME TAX is a direct tax which is to be paid by the person who is liable and it cannot be transferred.

Since Income tax is not an expense of business and it's is an expense of the business man. IT WILL BE TREATED AS DRAWINGS if it is paid by business.

INCOME TAX will be treated as drawing. It will reduce the capital of business man

hope it helps
#jerri
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