03 November 2009
A soya Company purchases Soya Seeds from the supplier and supplier charge VAT @ 4% in MP. Company makes payment to supplier without VAT and issue TDS Certificate for the VAT Amount as per Section 26-A of M.P. VAT Act. Summarize position is as follows:
Purchase Value 20 M.T. @ 17,000/- per M.T. = 3,40,000/- Add: VAT @ 4% = 13,600/- Total Purchase Value = 3,53,600/-
Company is making payment of Rs. 3,40,000/- to supplier and issuing TDS certificate of Rs. 13,600/- to supplier. Amount of TDS of Rs. 13,600/- is not required to be deposited to govt.
04 November 2009
The entries in following manner will present more perfactly scnario. presented in sequential manner as under;
(1) Entry for purchase
Inventory A/c Dr. (With Inventory amt) Exp.on purchase A/c Dr. (Exp.amt payable) VAT Receivable - Input A/c Dr. (VAT included in vendor’s Invoice for Issue of TDS certificate)
TDS under VAT A/c Cr. (VAT amt.to be deposited with deptt.) Vendor’s A/c Cr. (Amt.including exp.by vendor but excluding VAT)
(2) Deposit of VAT with Commercial Department TDS under VAT A/c Dr. Bank A/c Dr.
(3) Issue of TDS under VAT certificate Vendor’s A/c Dr. VAT Receivable - Input A/c Cr.
Kindly, revert with valuable opinion please, if any.
CAclubindia
