Taxes Recoverable

Code: 1174
👁 Views: 257

Account Information

Financial Statement Statement of Financial Position
Normal Balance Debit

Definition

Tax amounts and payments recoverable by the entity or available for offset against future tax liabilities, including tax withheld from amounts due to the entity, advance income or corporate tax payments, and overpaid current taxes. Recoverable value added tax is recorded in a separate account.

Common Journal Entries

Recorded VAT refund receivable

Dr. Tax Refund Receivable
Cr. VAT Payable

Received tax refund in cash

Dr. Cash in Hand
Cr. Tax Refund Receivable

Received tax refund via bank

Dr. Bank Account
Cr. Tax Refund Receivable

Written off non-refundable tax

Dr. Tax Expense
Cr. Tax Refund Receivable

📐 IFRS vs US GAAP Accounting Treatment

IFRS IAS 12 Income Taxes
US GAAP ASC 740 Income Taxes

❓ Frequently Asked Questions

Q: What is tax refund receivable?

A: Tax amounts receivable by the company from government authorities, such as overpaid income tax or recoverable VAT.