CA Tribhuwan Dewangan
Accounting Entries for GST :-
The Goods and Services Tax has revolutionized the Indian taxation system. The GST Act was passed in the Lok Sabha on 29th March, 2017, and came into effect from 1st July, 2017. GST is a Indirect Tax which replaced Excise Duty, Service Tax and Value Added Tax (VAT). Now the GST is is a single tax on the supply of goods and services, right from the manufacturer to the consumer.
It has been observed that there is lots of confusion among small business person and retail traders on how to maintain accounts related to GST, how to make entries in the books of accounts, how to pay the liability and how to book the inputs.
In this article I am trying to clear accounting aspects relating to Goods and Service Tax for small business person or retail traders –
| 1 | For Booking Sale/Service | Debit Amount | Credit Amount | Accounting Head | ||
| Party/Cash/Bank | Dr | Sundry Debtors/Bank/Cash | ||||
| To | IGST Payable | Current Liabilities | ||||
| Or | ||||||
| To | CGST Payable | Current Liabilities | ||||
| To | SGST Payable | Current Liabilities | ||||
| To | Sale/Service | Income | ||||
| 2 | For Purchase/Expenses | Debit Amount | Credit Amount | Accounting Head | ||
| Purchase /Services Received | Dr | Expenses | ||||
| IGST Receivable | Dr | Current Assets | ||||
| Or | ||||||
| CGST Receivable | Dr | Current Assets | ||||
| SGST Receivable | Dr | Current Assets | ||||
| To | Party/Cash/Bank | Sundry Creditors/Bank/Cash | ||||
| 3 | For Expenses related to RCM/Purchase from Unregistered Dealer | Debit Amount | Credit Amount | Accounting Head | ||
| Carriage Inward/Expenses | Dr | Expenses | ||||
| IGST Receivable( RCM) | Dr | Current Assets | ||||
| Or | ||||||
| CGST Receivable (RCM) | Dr | Current Assets | ||||
| SGST Receivable (RCM) | Dr | Current Assets | ||||
| To | IGST Payable | Current Liabilities | ||||
| Or | ||||||
| To | CGST Payable | Current Liabilities | ||||
| To | SGST Payable | Current Liabilities | ||||
| To | Party/Cash/Bank | Sundry Creditors/Bank/Cash | ||||
| 4 | At the time of Payment of Expenses | Debit Amount | Credit Amount | Accounting Head | ||
| Party A/c | Dr | Sundry Creditors | ||||
| To | Cash/Bank | Cash/Bank | ||||
| 5 | At the time of Settlement of GST A/c or Payment through Input Credit | Debit Amount | Credit Amount | Accounting Head | ||
| IGST Payable | Dr | Current Liabilities | ||||
| or | ||||||
| CGST Payable | Dr | Current Liabilities | ||||
| SGST Payable | Dr | Current Liabilities | ||||
| To | IGST Receivable | Current Assets | ||||
| or | ||||||
| To | CGST Receivable | Current Assets | ||||
| To | SGST Receivable | Current Assets | ||||
| 6 | At the time of balance amount of GST Payable to be paid | Debit Amount | Credit Amount | Accounting Head | ||
| IGST Payable | Dr | Current Liabilities | ||||
| CGST Payable | Dr | Current Liabilities | ||||
| SGST Payable | Dr | Current Liabilities | ||||
| To Bank/Cash | Bank/Cash | |||||
| 7 | After payment of RCM next month we will take credit | Debit Amount | Credit Amount | Accounting Head | ||
| IGST Receivable | Dr | Current Assets | ||||
| or | ||||||
| CGST Receivable | Dr | Current Assets | ||||
| SGST Receivable | Dr | Current Assets | ||||
| To | IGST Receivable( RCM) | Current Assets | ||||
| or | ||||||
| To | CGST Receivable (RCM) | Current Assets | ||||
| To | SGST Receivable (RCM) | Current Assets | ||||
| 8 | At the time of receiving Advance against supply | Debit Amount | Credit Amount | Accounting Head | ||
| Bank | Dr | 50000 | Bank | |||
| IGST Interim Payable | Dr | 9000 | Current Liabilities | |||
| or | ||||||
| CGST Interim Payable | Dr | Current Liabilities | ||||
| SGST Interim Payable | Dr | Current Liabilities | ||||
| To | IGST Payable | 9000 | Current Liabilities | |||
| or | ||||||
| To | CGST Payable | Current Liabilities | ||||
| To | SGST Payable | Current Liabilities | ||||
| To | Party | 50000 | Sundry Debtors | |||
| (Suppose we have received advance of Rs. 50,000/- & IGST is 18%) | 59000 | 59000 | ||||
| 9 | At the time of Billing /Invoicing | Debit Amount | Credit Amount | Accounting Head | ||
| Party | Dr | 118000 | Sundry Debtors | |||
| To | IGST Payable | 9000 | Current Liabilities | |||
| or | ||||||
| To | CGST Payable | Current Liabilities | ||||
| To | SGST Payable | Current Liabilities | ||||
| To | IGST Interim Payable | 9000 | ||||
| To | or | |||||
| To | CGST Interim Payable | Current Liabilities | ||||
| To | SGST Interim Payable | Current Liabilities | ||||
| To | Sales/Service | 100000 | Income | |||
| (Billed amount is Rs. 1,00,000/- and IGST 18%, IGST Interim Payable will adjust first & balance will be payable) | 118000 | 118000 | ||||
Note: –
1. The IGST or CGST & SGST will be applicable as the case may be IGST will be applicable in case of inter state sale (other state sale) CGST & SGST will be applicable in case of intra state sale (within the same state)
2 In this article only GST impacted entries has been discussed.
Disclaimer: The views expressed in this article are strictly personal. The content of this document are solely for informational purpose. It doesn’t constitute professional advice or recommendation. The Author does not accept any liabilities for any loss or damage of any kind arising out of information in this article and for any actions taken in reliance thereon.
Dear Sir
if purchase a car mobile charger for company vice president so we have post entry witch expenses.
Bill of entry on import invoice ki entry kese hogi?
Dear Sir,
Please guide the entries explained at point No. 8 & 9 for advances and billing thereof, along with the appropriate figures and GST payment liability when advance received & bill generated are in two different months.