## Documentation Index

Access the complete documentation index at:
https://www.zoho.com/books/kb/llms.txt

Use this file to discover all available documentation pages before proceeding.

[Back](./)

# How do I record tax on profit?

Taxes on profits can be recorded by creating an expense with Tax Payable as the expense account. To create an expense:

*   Go to the **Purchases** tab on the left sidebar and select **Expenses**.
*   Create an expense by clicking **\+ New**.
*   Select **Tax Payable** under Other Current Liability as the **Expense Account**.
*   Enter the tax amount.

**Insight:** To get the tax amount, run the [**Profit & Loss report**](https://www.zoho.com/books/help/reports/business-overview.html#pnl) for the particular period and calculate the tax from the net profit.

*   Select the **Paid Through** account. This can be the account from which you want the tax to be deducted.
*   Enter all the other necessary details.
*   Click **Save.**

An expense recording the tax on profit will be created.

**Note:** If you have configured your tax settings to track taxes under separate accounts, then you will have to create a [**Manual Journal**](https://www.zoho.com/books/help/accountant/manual-journal.html#record-manual-journals) with Output Tax as the Debit account and the account from where you want the tax amount to be deducted as the Credit account, to record a tax amount on the profit.