Excess Sales Tax paid

[PONNADA B K RAVIKUMAR]

Dear Sir, We paid excess local sales tax for the year 2004-05, and we debited to Sales tax paid, now we got the refund , so which account we have to give credit, sales tax paid or other income. Pls confirm sir

[Guest]

plese credit to refund of sales tax account in other income

AI Summary

Excess sales tax refund should be credited to a refund of sales tax account under other income. The operative accounting instruction is to credit the refund to a refund of sales tax account under other income, rather than directly to sales tax paid.