Accountin Transection

Save Share

This query is : Resolved

Quick Summary

This discussion addresses how to handle accounting entries for a business that supplies manpower and materials under a binding contract. The query focuses on transactions where the client reimburses expenses like employee bonuses, extra payments, and URD material purchases. The advice suggests that if these reimbursements are part of the contract, the entire amount received should be treated as the value of supply, with GST payable on the total sum, likely at 18%.

RUPESH R.H.

RUPESH R.H. (Querist)

01 May 2020 Respected sir/madam
I have following query
We are providing manpower supply service along with material for which we have binding contract with our client.
Apart from contract with our client. They made payment to us for expenses like bonus, extra pymt to employees and for URD material purchase. We paid that amount to employees and Supplier.
So how should we treat accounting entries on that transaction.
Whether we should book income on that transaction and paid gst.
Please let me know the journal entries.
Thanks!!!

CA Altamush Zafar

CA Altamush Zafar (Expert)

01 May 2020 If the contract includes all such reimbursements then value of supply will include all such receipts from the customer and GST will be payable on the whole amount.