Dear ALL,
A normal journal entry on Sage for corp tax would show it display and included under Overheads to arrive at net profit.
How does one post the provision to show it display after net profit?
Any help appreciated. Thank you in advance.
Marcus Yeong
Replies (4)
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Consistent
Not an ideal situation. The thing is to be consistent with both dividends and corporation tax together. Otherwise you get some kind of confusing hybrid. I hate the idea of CT and dividends being regarded as 'overheads'.
Instead of just posting to the reserves account, you could create new nominal accounts in the capital section of the chart of accounts for CT and dividends. That way at least there is transparency in the balance sheet that the 'reserves' account is pre-tax and agrees with the P&L and you can see the CT and dividends as deductions (debits).
To reserves
Either you show it as an overhead, or you post it to reserves (this, incidentally, is Sage's advice and is on one of their factsheets).
Ditto dividends.
Nominal Codes for Corporatation Tax
I wonder if I could have more specific information on posting Corporation Tax...... my accountant is not familiar enough with Sage to advise. His Journal is CR P&L: DR B/S
So which codes, if I want to avoid posting to overheads? CR??? DR 2320