Accounting policies
This query is : Resolved
26 September 2016
please let me know the following
If advertisement exp Rs-100000/- & service tax Rs-15000/-when we make the payment after deduction of TDS,we pass the entry
Adv.... .Dr100000
Service Tax...Dr15000/-
TDS @2% 2000/-( TDS deducted Gross Value- Service Tax *2%)
To Party 113000/-
Is the above entry correct.There is any violation of AS1
Regards
Amit Nandy
If advertisement exp Rs-100000/- & service tax Rs-15000/-when we make the payment after deduction of TDS,we pass the entry
Adv.... .Dr100000
Service Tax...Dr15000/-
TDS @2% 2000/-( TDS deducted Gross Value- Service Tax *2%)
To Party 113000/-
Is the above entry correct.There is any violation of AS1
Regards
Amit Nandy
27 September 2016
No the entry is not correct. The entry should be:-
Adv. 100500
ST 14000
KKC 500
To TDS 2000
To Party 113000.
Explanation:- U can claim Cenvat of Service Tax and Krishi Kalyan Cess, hence both should be debited(or transferred to ST/KKC Input tax credit). Swcch Bharat Cess Cenvat is not available to claim as ITC by the assessee so I added it to value of advertisement, U can also transfer to SWC ITC account if u want, but remember we cant' claim credit of it. TDS is ur liability to pay, so it should be credited, instead of debit.
Adv. 100500
ST 14000
KKC 500
To TDS 2000
To Party 113000.
Explanation:- U can claim Cenvat of Service Tax and Krishi Kalyan Cess, hence both should be debited(or transferred to ST/KKC Input tax credit). Swcch Bharat Cess Cenvat is not available to claim as ITC by the assessee so I added it to value of advertisement, U can also transfer to SWC ITC account if u want, but remember we cant' claim credit of it. TDS is ur liability to pay, so it should be credited, instead of debit.
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