I have reversed ITC in books because wrong uploading of Invoice. i.e., B2B shown in B2C or not shown in GSTR - 1 by my suppliers.
Now have reversed ITC in my books by passing accounting entry.
Creditor a/ c dr 50
To ITC Receivable A/c 50
Being Input Tac Credit reversed due to wrong uploading of invoice/ non uploading of invoice by supplier in GSTR- 1
Now I want recover GST amount paid by me on Purchase as Supplier failed to upload invoice.
Now recovery of gst amount from supplier is my income or not.
Please, guide me with Detailed accounting entries in books.
Thanks in advance
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Reversal ITC in books
Replies (3)
Quick Summary
Example
Taxable value - 100
GST - 18
Total paid - 118
Entry1: due entry
Dr.Purchases 100
Dr.GST receivable 18
Cr.Creditor 118
Entry 2: payment
Dr.Creditor 118
Cr.Cash/Bank 118
Entry 3: entry of GST portion recoverable/reversal of GST receivable
Dr.Creditor 18
Cr.GST receivalbe 18
After all these entries, you are left with Creditor having a debit balance of 18 which is recoverable as extra payment
One cannot make profit out of himself. You are receiving what you have actually paid. It is not your income, It is your asset. You are recovering the extra payment.
Entry4: Recovery Entry
Dr.Cash 18
Cr.Creditor 18
But instead of receiving ITC from suppliers, can I write off the gst Receivable to p& l a/c
by passing accounting entry as under
p& l a/c dr 18
To Gst ITC Receivable 18
as I don't want to recover money from my suppliers
by passing accounting entry as under
p& l a/c dr 18
To Gst ITC Receivable 18
as I don't want to recover money from my suppliers
Yes. The unrecoverable book debt is bad debt. Hence you can write it off in the P&L account.
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