GST reverse charge

Purchase:

Purchase a/c                  Dr

Provisional ITC of CGST (under RCM)

Provisional ITC of SGST (under RCM)

To ABC Party a/c                 (For material purchase)

To CGST (under RCM)          (For CGST)

To SGST (under RCM)          (For SGST)

Availing ITC after fulfilling conditions:

ITC of CGST                  Dr

ITC of SGST                  Dr

To Provisional ITC of CGST (under RCM)

To Provisional ITC of SGST (under RCM)

1st entry  will be 

1) Expense  A/c Dr  

    To Sundry Creditors  A/c  Cr 

( booking of expense payable on RCM  ) 

2)  Then  create  Reverse charge A/c  under  current asset 

      Reverse Charge  A/c      Dr 

      To  CGST             A/c      Cr 

      To SGST              A/c      Cr 

(  Increase the liability  of Tax ) 

3)     CGST                 A/c        Dr 

        SGST                 A/c         Dr 

        To bank              A/c          Cr 

( Payment of Tax )  

4)     CGST                     A/c        Dr 

        SGST                    A/c         Dr 

        To reverse charge  A/c        Cr 

(  Increase  for  input tax credit )