Journal entries

Bill amt 1,00,000+ charge 18 % Gst, vendor raised an invoice for contract service, and I have to make payment for this.


1).Contract Service A/c -  Dr  1,00,000
   IGST @ 18 %            -dr    18,000

  To service provider(Sundry CR)                       1,18,000

2)  Sundry CR. A/C     - Dr 1,18,000
    To TDS @ 2 % U/S 194C 2,000
    To Bank A/c         1,16,000


is this wrong entry? 


It is perfectly alright, provided the contractor is not based in the same state, in which he is providing the contract service to you.

Total likes : 1 times

student-CA FINALS

Just one correction here, Tds liability should be made at the time of invoice received or payment made w. e is earlier so here tds liability needs to be created with invoice entry and not at the time of payment.


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