Taxation Control Account

[JPWilliams007]

Hi,

When tax is paid bi-annually it gets processed to the 9550-000 Taxation payable account, does this account get cleared out at the financial year-end and what is the journal entry?

Your advise will be appreciated.

Thanks

[Andromeda]

does this account get cleared out at the financial year-end

No it does not. Your accountant will calculate the tax due for the year and will debit the current tax account in the income statement, and credit the Payable account. The balance in theory represents what you still owe SARS, or what SARS owes you due to you paying too much provisional tax.

[JPWilliams007]

Many thanks, I thought that was the case.