on 05-11-2012 6:50 AM
Dear Gurus,
Could you please let me know,
whether the Tax entries will appear during payments (Vendor/Customer)?
Tax is applicable only for invoice or for payments also?
My question is for Vendor Invoice we have the entries like below
Inventory A/c Dr (900)
VAT receivable A/C Dr (100)
Vendor A/C Cr (1000)
Similarly for Customer Invoice
Sales A/C Cr (900)
VAT Payables A/C Cr (100)
Customer A/C Dr (1000)
So, during payment how the entries would be?
case-1: Vendor Payment
Bank A/c Cr (1000)
Vendor A/c Dr (1000)
Case-2:
Bank A/c Dr (1000)
Customer A/C Cr (1000)
Is this how the entries will come or some other?
Please let me know
Regards,
Sridhar.
In simple words...your entries are absolutely correct for VAT.
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Hello Sridhar,
At the time of invoice you have already posted to Payable account, again at the time of payment why tax will be deducted, if we deduct, then you are deducting tax two time for single transactions.
For indian scenario, for vendors below are the entries
MIGO: Stock A/c Dr
GR/IR A/c Cr
Posting Excise Invoice
RG23A A/c Dr
Excise payable A/c Cr
Vendor Invoice
Vendor A/c Cr
GR/IR A/c Dr
Excise Payable Dr
Same in case of Sales, instead of excise payable, it will go to Excise Paid account at the time of customer Invoice.
Thanks and Regards
A.Rama Krishna
Regards
A.Rama Krishna
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Hi Sridhar,
whether the Tax entries will appear during payments (Vendor/Customer)?
Tax is applicable only for invoice or for payments also?
There is no tax entry will applicable during the payment entry ( Applicable for AR & AP) for Indian Scenario. Country wise it may change. One of my previous Mexico project ,VAT applicable on down payments also for Both cases.
For Indian standard entries are correct.
Rgds
Mani
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