Esic & epf

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

06 December 2013 Dear sir
we are service provide & we hv receive a contractor bill for the service, in which he is not registered under ESIC & EPF act . now we are deducting esic & epf of the contractor @6.75% & 25.61%. pls suggest what accounting entry to be passed inn the books

regards
rakesh sharma

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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06 December 2013 Principal employer is responsible for PF/ESI incase contractor not registered. you can make the normal PF payable entry with separate contract labours ledger and credit and discharge the liability

Hitendra Jain

Hitendra Jain (Expert)
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06 December 2013 If Expenses can be recovered from the contractor then:

Contractor A/c Dr.
To PF Contribution Contractor
To PF Contribution Employer
To ESIC Contribution Contractor
To ESIC Contribution Employer
[Being Contribution to PF and ESIC provided for]

If Expenses can not at all recovered then:

Legal & Professional Expenses Dr.
To PF Contribution Contractor
To PF Contribution Employer
To ESIC Contribution Contractor
To ESIC Contribution Employer
[Being Statutory Expenses for Job Work / Contract Provided For]

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Querist : Anonymous

Querist : Anonymous (Querist)

09 December 2013 thanks sir