CHARTERED ACCOUNTANT
66 Points
Joined October 2010
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]