Vat & cst

Others 754 views 7 replies

How should I adjust input sales tax, output sales tax & payment of sales tax in Accounts?

Regards

Replies (7)

Account as follows:

On purchases: Dr. Respective purchase a/c

                       Dr. Input Tax Credit a/c

                      Cr. Sundry Creditor a/c

 

On sales: Dr. Sundry Debtor a/c

                Cr.  Respective Sales a/c

               Cr. VAT Collected a/c.

 

On month end: [for the amount input credit (or) vat collection, whichever is lower]

                        Dr. VAT Collected a/c

                        Cr. Input tax credit a/c

[if input credit is higher, this is to be c/f, if vat collection is higher, this is to be remitted]

agreee with above

How should i incorporate them in the financial statements?

Regards

VAT Input credit to be grouped under current assets.

VAT collection account to be grouped under "Duties & Taxes" - Current Liabilities.

In the month end, only one account will have the balance and that will automatically fall in the balance sheet, once you pass the necessary entries.

yes, i also agree with miss. k chitra...comments...

 

Agree with K. Chitra

Are there any alternative methods?

Regards


CCI Pro

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