VAT-Entries

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VAT-Entries

under VAT we have purchase credit and sales tax liability and net liability after taking purchase tax credit we will pay and this is every month exercise in tally we do. Now pls suggest me whether I should pass monthly journal entry for the net liability I pay. and any further entries I for my finalisation of accounts. Thanks for the members support so much. 

Replies (2)

No any further entry required......... as u say take a example:- 

Your input tax credit- Rs. 25000/- and VAT liability Rs. 37500/-

then u required to pay Rs. 12500/-. IF you crate septare ledger for Input and output then u required follwing entry:-

Vat output                    Dr.                         37500

     To Vat Input                                                           25000

     To Bank                                                                  12500

 

Correct me if i m unable to undrestand ur querry

1)At the time of Purchase

Purchase 5% Dr 100000

Input Vat 5%   Dr 5000

    To Creditor                     105000

2)At the time of Sale

Cash     Dr 157500

     To Sales 5%          150000

     To Output Vat 5%   7500

3) Final Adjustment

Output Vat 5%    Dr 7500

   To Input Vat 5%        5000

   To Vat Payable(CL)          2500

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