HANDBOOK FOR ACCOUNTANTS - JOURNAL ENTRIES

GST HANDBOOK FOR ACCOUNTANTS JOURNAL ENTRIES

Prepared by: CA. Venugopal Gella

Intention:

1. To Ease the Accountant 2. Tally screenshots are presented for educational purpose.

Venugopal Gella

3. No part of the document shall be construed as promotion of any Cpherasrotne/roerdgaAnciscaotuionnt.ants 4. This is the V 1.0, and we update the document time to time.

Tuesday, 25 July 2017

Contents

List of Ledgers to be created...................................................................................................................... 2 Journal Entries in Books of accounting ...................................................................................................... 3 Recording a journal voucher in tally .......................................................................................................... 7

Create RCM Purchase Ledger ................................................................................................................ 7 Accounting for RCM Transaction ........................................................................................................... 8 Increase Tax Liablity ............................................................................................................................... 9 Increase Liability and Credit Jointly ..................................................................................................... 10 Payment of Taxes.................................................................................................................................11 RCM Payment Voucher ........................................................................................................................ 12 Recording a journal voucher to raise liability for reverse charge........................................................13 Reverse RCM Liability & Take Credit...................................................................................................15 Claim tax credit when the advance amount paid matches with the purchase value..........................16 Cancellation/Reversal of Payment Voucher ........................................................................................ 19 Purchase Returns under reverse charge..............................................................................................20 To record a debit note ......................................................................................................................... 22 Input Tax Credit........................................................................................................................................24 P&L and GST.............................................................................................................................................25 Return for the Month of July, August & September due dates ............................................................... 26

1

Venu & Vinay

Chartered Accountants

List of Ledgers to be Created

There is no defined rule of accounting for GST. These ledgers and entries are created to have better control and ease of reconciling with the books Electronic Registers maintained by GSTN. If multiple GSTIN Books are maintained in same entity additional ledgers may be created as per the need.

Current Assets Input CGST A/c Input SGST A/c Input IGST A/c Input CGST RCM A/c Input SGST RCM A/c Input IGST RCM A/c Input CGST URD A/c Input SGST URD A/c Input IGST URD A/c ITC CGST Ledger A/c ITC SGST Ledger A/c ITC IGST Ledger A/c Provisional ITC CGST A/c Provisional ITC SGST A/c Provisional ITC IGST A/c Electronic Cash CGST Ledger A/c Electronic Cash SGST Ledger A/c Electronic Cash IGST Ledger A/c Cash/ Bank A/c

Duties and taxes (current liabilities) 9% Output CGST A/c* 9% Output SGST A/c* 18% Output IGST A/c* 9% Output CGST (Advance) A/c 9% Output SGST (Advance) A/c 18% Output IGST (Advance) A/c CGST Advance A/c SGST Advance A/c 9% Output CGST URD A/c(Liability) 9% Output SGST URD A/c(Liability) 18% Output IGST URD A/c(Liability) 9% Output CGST RCM A/c(Liability) 9% Output SGST RCM A/c(Liability) 18% Output IGST RCM A/c(Liability) IGST Advance A/c *Note: Here only 18% GST rate is considered. Similar entries apply for other rates of taxes.

Sales A/c Local B2B sales A/c Local B2C sales A/c Interstate B2B sales A/c Interstate B2C sales A/c

Direct Expenses A/c

Direct Expenses Registered A/c

Direct Expenses Unregistered A/c

Purchase A/c Local Purchase A/c Interstate Purchase A/c Local RCM Purchases A/c Interstate RCM Purchases A/c URD Purchase A/c Import A/c Local Composition Dealer Purchase A/c Interstate Composition Dealer Purchase A/c Exempt & Nil rated Purchase A/c

Current Liability Liability Ledger CGST A/c Liability Ledger SGST A/c Liability Ledger IGST A/c

Indirect Expenses A/c Indirect Expenses Registered A/c Indirect Expenses Unregistered A/c

Sundry Creditors (Group in tally) Creditors ? Registered Creditors ? Unregistered

Creditors ? Registered (ledger) Vendors A/c (registered) Vendors A/c (unregistered)

Sundry Debtors

Debtors

2

Venu & Vinay

Chartered Accountants

Journal Entries in Books of accounting

Transaction

Under GST (All values are sample number for understanding)

Outward Supply-Sales

Local Sale ? B2B Interstate Sale

Dr Debtors A/c Cr Local B2B sales A/c Cr 9% Output CGST A/c Cr 9%Output SGST A/c

Dr Debtors A/c Cr Interstate B2B sales A/c Cr 18% Output IGST A/c

1,41,600 1,18,000

1,20,000 10,800 10,800

1,00,000 18,000

Reporting in GSTR table

GSTR 1 Table 4A eCommerce Transactions can be an additional entry GSTR 1 Table 4A

Local Sale ? B2CL

Export (When GST payable) Export

Dr Debtors A/c Cr Local B2C sales A/c Cr 9% Output CGST A/c Cr 9% Output SGST A/c

Dr Debtors A/c Dr IGST Refund Due A/c.

Cr Sales (export) A/c Cr 18% Output IGST A/c Dr Debtors A/c Cr Sales (export) A/c

11,80,000

2,00,000 36,000

1,25,000

10,00,000 90,000 90,000

2,00,000 36,000

1,25,000

GSTR 1 Table 5 To report with state code

GSTR 1 Table 6A With payment of Duty

GSTR 1 Table 6A Under LUT or Bond

Local Sale ? B2CS Exempted / NIL

Dr Debtors A/c Cr Local B2C sales A/c Cr 9% Output CGST A/c Cr 9% Output SGST A/c

Dr Debtors A/c Cr Exempted Sales A/c

1,41,600 1,50,000

1,20,000 10,800 10,800

1,50,000

GSTR 1 Table 7A

GSTR 1 Table 8

Credit Note ? B2B

Credit Note ? B2C

Advance receipt (say in July) (A)

Dr Local B2B sales A/c Dr 9% Output CGST A/c Dr 9% Output SGST A/c

Cr Debtors A/c Dr Local B2C sales A/c Dr 9% Output CGST A/c Dr 9% Output SGST A/c

Cr Debtors A/c Dr Cash/Bank A/c Dr IGST Advance A/c

Cr Customer A/c Cr 18% Output IGST (Advance) A/c

Raising of Invoice in subsequent month (say in August) (B)

Dr Customer A/c Cr Sales A/c Cr 18% Output IGST A/c

Dr 18% Output IGST A/c Cr IGST Advance A/c

Dr Cash/Bank A/c Cr Customer A/c

1,20,000 10,800 10,800

1,20,000 10,800 10,800 10,000 1,800

1,18,000

1,800

1,08,000

1,41,600

1,41,600 10,000 1,800

GSTR 1 Table 9 Adjustments to Past sales

GSTR 1 Table 10 Adjustments to Past sales

GSTR 1 Table 11A

1,00,000 18,000

GSTR 1 Table 4A

1,800 1,08,000

GSTR 1 Table 11B

N A

3

Venu & Vinay

Chartered Accountants

Inward Supply-Purchases from

Registered Dealer - Intra state

Registered Dealer - Intra state (Not reflected in supplier i.e. GSTR 1 mismatch case) Registered Dealer (Inter State)

Dr Local Purchase A/c Dr Input CGST A/c Dr Input SGST A/c

Cr Vendor (registered) A/c Dr Local Purchase A/c Dr Input CGST A/c Dr Input SGST A/c

Cr Vendor (registered) A/c

Interstate Purchase A/c Dr Input IGST A/c

Cr Vendor (registered)A/c

1,00,000 9,000 9,000

10,000 900 900

15,000 2,700

1,18,000 11,800 17,700

Inward Supply attracting Reverse charge mechanism:

1) Notification No.8/2017-Central Tax (Rate) ? Exemption from payment of

tax under reverse charge on inward supplies from dealer who is/are

unregistered dealers

?> Limit = Amount < 5,000/ day = Exempted from Tax (within state only)

2) Notification 4/2017-Central Tax (Rate)- List of goods on which Reverse-

charge is applicable

3) Notification 13/2017-Central Tax (Rate) - List of goods on which Reverse-

charge is applicable

(For better understanding RCM payable on URD is referred as URD only)

Purchase from Dr URD Purchase A/c

20,000

Unregistered

Cr Vendor (unregistered) A/c

20,000

Dealer (Day 1)

Tax payable on Dr Input CGST URD A/c

1,800

Reverse charge Dr Input SGST URD A/c

1,800

from above URD

Cr 9% Output CGST URD

1,800

purchase (Day 1) A/c(Liability)

1,800

Cr 9% Output SGST URD

A/c(Liability)

Purchase from Dr URD Purchase A/c

4,500

unregistered

Cr Vendor (unregistered)A/c

4,500

dealer (Day 2)

(As the amount doesn't exceed

5,000/day overall thus exempted)

Legal service

Legal Expenses A/c

30,000

received on which

Cr Service Provider (registered)

30,000

tax is payable on A/c

reverse charge

Tax payable on Dr Input CGST RCM A/c

2,700

reverse Charge Dr Input SGST RCM A/c

2,700

Cr 9% Output CGST RCM

2,700

A/c(Liability)

2,700

Cr 9% Output SGST RCM

A/c(Liability)

Composition

Dr Purchase

50,000

Dealer

Cr Creditors

50,000

Expenses & Purchase of Capital Goods

Indirect Expenses

Dr Telephone Charges A/c Dr Input CGST A/c Dr Input SGST A/c

Cr Bank

5,000 450 450

5,900

GSTR 2 Table 3 GSTR 2 Table 3

GSTR 2 Table 3

GSTR 2 Table 4B GSTR 2 Table 4B

GSTR 2 Table 4B GSTR 2 Table 4A GSTR 2 Table 4A

GSTR 2 Table 7A/7B

GSTR 2 Table 3

4

Venu & Vinay

Chartered Accountants

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