MyCIMA

Double Entry for CT Liability

Replies : 2

I have calculated the corporation tax liability of a small company. I then make an entry (using Sage Line 50):

debit 9000 corporation tax expense in P&L

credit 2320 corporation tax laibility in BS

However, when I now look at the P&L, I get a profit figure distorted by the above P&L entry, yet the BS seems correct except for the P&L figure again.

Do I need to adjust the chart of accounts so that 9000 is reported after the profit figure? 

I'd be grateful for any help. I'm sure it's a simple one, but my first time.

Sage Technical Help ?

It does appear that the corporation tax line is not in the correct place in your chart of accounts.  I am not a Sage Line 50 user but, in the absence of any replies from actual users, I would have thought that there was a Sage techncial help line that you could contact - check your documentation for the software package.

CT Reserve

It's best to keep corp tax out of the P&L when working with sage.  You should debit account 3290 - I think it's a standard account?

After the year end you can transfer this debit to the P&L reserve account: 3200