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Vat input closing entry

sujata (article clerk) (37 Points)

09 June 2013

VAT input is standing in trail balance since 2006. there is no possibilty of output in future as the VAT registration has been cancled. How to pass a reversal entry?? or how to write off this VAT input???

Experts PLs REPLY..

Thanks..

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3 Replies

Sheena Maheshwari (ARTICLESHIP) (240 Points)
Replied 09 June 2013

The Vat input will be written off as follows:

VAT payable account

To VAT credit receivable account

Devendra (Chartered Accountant) (4780 Points)
Replied 09 June 2013

The VAT Input shall be written off to the Profit & Loss account by passing the following JV :

VAT Expense A/c Dr XXX

To VAT Input A/c XXX

(Being VAT Input A/c transferred to Expense A/c)

Regards,

Devendra Kulkarni

2 Like

HARI PRASAD (M.COM) (172 Points)
Replied 12 June 2013

Hello sujatha,

With refference to the above query, the following entry may be passed as reversal entry for the Input vat what u have paid and waiting for it to be adjust in output tax liablity and there is no scope of output so...

as u know when u paid input tax in purchases, (1) Vendor/seller a/c Dr xx

To Input vat a/c xx

(being vat paid on purchases)

so, now u want to reversal the afore said transaction from the books since there is no scope of Output here as follows

(2) Input vat a/c Dr xx

To Vendot a/c xx

( being reversal of input vat...)

Thereafter u need to book the same amount to P&L a/c as expenses/loss by passing the JV entry

(3) Input vat a/c Dr xx

To P&L a/c

(being input vat transferred to P&L a/c..)

I conclude.