How to add Corporation Tax line

[JPTrades]

Hi all,

At year end, how do I automatically add the corporation tax line to the P&L, and also the Tax payable to the Balance Sheet?

[Tut]

Tax payable is an automatically created liability account that appears on the balance sheet when you use a tax code. See the Guide:

Setting up tax codes

Tax codes are available under the Settings tab to track obligations for sales tax, goods and services tax, value added tax and other taxes imposed by a country or regional tax authority. [image] When you are using tax codes, you will be able to select a tax code for each transaction line. For example, if you receive 1,100 which includes 10% tax, it can be recorded as follows. [image] Similarly, if you spend 550 which includes 10% tax, it will be recorded like this: [image] By using tax cod…

But Tax payable does not relate to taxes on income, since so many things can affect that. It records the liability a company has for taxes, such as VAT or sales tax, collected by the business on behalf of the tax authority. Such tax will eventually be remitted to the tax authority.

If, by “corporation tax,” you mean a tax on corporate income, you should create an expense account in the chart of accounts. See the Guide:

Set up chart of accounts

When setting up a new accounting system, usually you start with the Chart of accounts. But what is the Chart of Accounts? Definition on the Internet says: The chart of accounts is a listing of all accounts used in the general ledger of an organization. What does this even mean? Well, let’s look at a sample balance sheet which is a key financial statement that will be required for your business: [image] A balance sheet is a report of the assets and liabilities of a business. Every asset o…

Manager is not tax software, so it will not figure how much tax you owe on income. But to record tax paid, Spend money from a cash account and post the transaction to the expense account you created for that purpose.

[Brucanna]

You can’t automatically add the corporation tax line but you can set one via Settings - Chart of Accounts and then use a Journal. Also for the Balance Sheet set up a Liability account called Provision for Corporate Tax. Same process would apply for Dividends if applicable

If you read the below topics they provide solutions amongst a lot of discussion

What account does corporation tax go under?

I created a new account in chart of accounts called Corporation Tax and set it as a liability so it does not show up under profit and loss for tax purposes as its not an expense. Is this the correct procedure? I was not sure whether I should use the existing account called Tax Payable as that one seems to be calculating the VA and I don’t want to mess up the VAT Return by putting Corporation Tax into Tax payable.

Where to record dividends

Huge thank you for this amazing piece of software! It really has made my accounting a whole heap easier! Just wondering if you can point me in the direction of where to log a directors dividend payment?

[subrosumon]

Hi, to set up corporate tax related issues I think a corporate rate module can be set the corporate tax rate rate and “Net profit (loss)” should be Net profit before Tax (NPBT) after this line Corporate to be calculated then presented as Net profit After Tax (NPAT), this tax will show under current liability. it is very important.

[Tut]

First, you are responding to a topic that has been dormant for 4 years. Some of the discussion is obsolete due to program improvements.

Second, you can design and build any chart of accounts you want. Therefore, it is not clear what you are asking or suggesting.

Third, Manager is not and very likely will never be tax computation software covering income taxes, corporation taxes, etc. With approximately 200 sovereign jurisdictions in the world, that would be a huge undertaking—one that no software company anywhere has attempted.

[subrosumon]

Firstly This is my suggestion though i can not find any corporate tax line.

Secondly- if i think an individually paid customer, definitely i expect full accounting treatment to be in my software. Otherwise competitor of manager can take this opportunity.

Thirdly Accounting software is selected by accounting professionals for the company. If any professional are newly joined and review existing software and he may express to company CEO to shortfall of this this segment and it is not work, so he may take an initiative to change the software company or some think like that.

[Tut]

@subrosumon

i can not find any corporate tax line.

That is because you have not added such an account. See https://www.manager.io/guides/9181.

@subrosumon

if i think an individually paid customer, definitely i expect full accounting treatment to be in my software.

Nothing in Manager’s advertising mentions anything about the program calculating corporation tax for your country or any other. If this is what you require, you should look elsewhere. In your profile you describe yourself as an accountant. You should, therefore, be aware of the differences between financial accounting and tax filing preparation.