Calculating Tax Paid

[Shahid_fss]

Please help me in calculating the amount of tax paid in 2007, from following available info

..........................................................2007................................2006
Tax Payable.....................................327515.............................353869
Current Tax.......................................71416....................................NA
Deferred tax assets...........................0.....................................0
Deferred tax exp.................................98850...................................NA
Deferred tax liabilities.................................104512................................5722
Adv Tax.............................................242082.............................231040
Tax Paid..................................................???

Amount I have calculated is 100272

[kamranACA]

Dear,

What I construed, you are asking this information for calculating cash flow figure of "income tax paid".

Always remember following formula to calculate it. (You may also make a 'T' account for this purpose

OPERNING INCOME TAX LIABILITY + CURRENT INCOME TAX PROVISION FOR THE YEAR - CLOSING INCOME TAX LIABILITY + CLOSING ADVANCE INCOME TAX BALANCE - OPENING ADVANCE INCOME TAX BALANCE


If you prefer to make 'T' account put on credit side

- opening income tax liability
- current income tax provision for the period/year
- closing advance tax balance

and;

put following on debit side

- opening advance tax balance
- closing income tax liability

and then calculate the balancing figure which will result in income tax paid or refunded.


Now following the above formula

Tax paid

= 353,869 + 71416 - 327515 + 242082 - 231040

= 108,812

Therefore, your answer is not correct. The income tax paid for the period/year is Rs. 108,812.


Always keep in mind that deferred tax has nothing to do with calculation of income tax paid as deferred tax is a notional provision/asset/expense.

Always ignore, deferred tax expense / income, deferred tax liabilities and deferred tax assets in above calculations.



Best regards,


Kamran.

[Shahid_fss]

Your gues was perfect.
I wanted to calculate tax paid for Cash Flow.
Thanks a lot for your help.

SHAHID