Tax Professional and in Service
1795 Points
Posted on 08 June 2011
Dear Jeetu,
You as a service receiver has to pay service tax on the amount of transportation charges paid whether inward transportation or outward transportation.
You can avail Service tax paid under GTA for inward transportation as cenvat credit but not service tax paid on outward transportation.
The entry needs to be passed as follows :
At the time of booking of expense :
1. Expense A/c ---------------------------------------------------------Dr. (amount inclusive of service Tax)
TO transporter A/c (Amount inclusive of service tax on GTA)
At the time of payment to transporter (For inward transportation bills)
2. Transporter A/c-----------------------------------------------------Dr. (Amount Excl service Tax)
cenvat A/c ---------------------------------------------------------------Dr.
To Bank A/c (Amount as per consignment note or invoice excl service tax)
To GTA A/c (Service tax on GTA amount)
To Expenses A/c (Cenvat Amount)
At the time of payment to transporter (For outward transportation bills)
2. Transporter A/c-----------------------------------------------------Dr. (Amount Excl service Tax)
To Bank A/c (Amount as per consignment note or invoice excl service tax)
To GTA A/c (Service tax on GTA amount)
Hope This solves ur query.
Thanks and Regards,
Manoj B. Gavali