I am working on a new client and i took the balances from previous yr trial balance. The company made corp tax installments in 2014 and 2015 around 40k Now the corp received 30k tax instalment refund. I have no idea where to enter in the books. The cheque was deposited in the bank account. The only documentation i have is from cra.
Did the accountant who prepared your corporate income tax return also give you any adjusting journal entries? If so, it is very likely that their best guess as to the expected refund was recorded on the balance sheet - possibly as an asset, possibly as a debit balance in the 'corporate income tax payable' account. If you can find a debit on the balance sheet for the expected tax refund, then your entry to record actually receiving the refund will simply be Debit Bank, Credit <<where-ever you found the debit>>.
If you can't find a debit on the balance sheet for the expected tax refund, you should talk to your year-end accountant about where to record the refund.
Thank you so much..