Enterprise income tax refund refers to the act of overpaying enterprise income tax due to calculation errors or policy adjustments when calculating the taxable income, and the tax authorities will refund the overpaid tax to the enterprise after verification. The following is the entry practice for corporate income tax returns:
1. When receiving the refund of enterprise income tax:
Borrow: Bank deposit.
Credit: Tax Payable – Income Tax Payable.
2. Adjustment of financial statements:
1.Adjust the income statement: The refunded corporate income tax will be deducted from the "income tax expense" account, and the "net profit" account will be added accordingly.
2.Balance sheet adjustment: The debit balance of the Tax Payable – Income Tax Payable account is written off from the Undistributed Profits account, and the debit balance of the Deferred Tax Liabilities account is adjusted accordingly.
3. Make tax adjustments
According to the requirements of the tax authorities, the corresponding tax adjustments will be made. For example, if the tax authority requires an adjustment to the corporate income tax of a previous year, the corresponding adjustment entries need to be made.
It should be noted that the processing of corporate income tax returns needs to follow the provisions of relevant laws, regulations and accounting standards to ensure the accuracy and compliance of entries. At the same time, enterprises should strengthen financial management and accounting to avoid overpayment of taxes due to calculation errors or policy adjustments.