Reverse charge accounting treatment

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 December 2014 we had receiver of service tax ,
We received man power services from vendor of Rs 1000 + 123.6 = 1123.60
But we have to pay how much amount for him ?
& Reverse Charges of Rs Serv Tax - 93 how to accounting in books -
its liablity or expenses?
Can we take Cenvat Credit -Rs 31(25%)?
Please give me solutions with ledger head sir. please
-----

Neljo Davis ACA

Neljo Davis ACA (Expert)
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04 December 2014 Amount Payable to Vendor is Rs.1031/-
Reverse Charge Payable Rs.93/- should be booked as liability and deferred asset.
Can take Cenvat Credit of Rs.31/-.
Can also take Cenvat Credit of Rs.93/- once the reverse charge is remitted.

Querist : Anonymous

Querist : Anonymous (Querist)

04 December 2014 sir actually we should pay him - (10000+31)=10031/- right?
because my quistion we are paying Tax liablity of 93 on behalf of him .and also how to make journal entry for defered asset -?

Neljo Davis ACA

Neljo Davis ACA (Expert)
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04 December 2014 Yes. You are right.
Expense Dr 1000/-
Cenvat Credit Dr 31/-
Cenvat Credit Deferred Dr 93/-
To Reverse Charge Payable Cr 93/-
To Vendor Cr 1031/-

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