Supply attracting rcm

how to pass accounting entry in tally of supply of service attracting RCM???
Replies (2)
Quick Summary
This discussion explains the accounting entries required in Tally for services subject to the Reverse Charge Mechanism (RCM). It details the process of booking expenses, creating entries for tax payable under RCM, making tax payments to the government, and claiming input tax credit. Finally, it covers the entry for settling payments to creditors.

Following  are RCM  entries  In books  of account  who pay  Tax under  Reverse charge   .

1)   Booking  of an expense entry  , Tax  payable  under  RCM  

      Expense              A/c        Dr 

     To Sundry  Creditors  A/c           Cr 

(  Booking entry  Tax payable under RCM ) 

 

2)   Create  Reverse Charge   A/c   under  Current  asset 

       Reverse  Charge          A/c      Dr 

       To CGST                      A/c                 Cr 

       To  SGST                     A/c                  Cr  

  (  Increasing  liability  of   Tax  ) 

 

3)     CGST                       A/c       Dr 

        SGST                       A/c       Dr 

        To    Bank                 A/c                  Cr  

(   payment  of   Tax   in GOVT  account ) 

 

4)   CGST                      A/c        Dr 

      SGST                       A/c        Dr 

      To  Reverse  Charge  account               A/c     Cr  

 (  Entry  for  claiming  Input  Tax credit  )  

 

5)   Payment  to creditors  

     sundry   Creditors        A/c       Dr 

     To Bank                       A/c                 Cr 

(  payment  made  to  Sundry  creditors  and Tax  paid  by  us  under  RCM  )    

prepare  Self  Invoice  for  RCM 

Sir, i cant say how thankful I'm to you....again thanks a lot sir...

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