07 August 2014
manpower contractor raised a invoice to us rs.112360 inclusive service tax rs. ?12360@12.36%. so what should I pass journel entry under reverse charge
by Ganeshbabu K on07 August 2014
Dr.Manpower Charges A/c 100000 Dr.Service tax input A/c 12360 Cr.Manpower Contractor name (balance fig) Cr.TDS Payable Contactor 194C 2%/1% on 1lakh
but under reverse charge we have to pay 75% service tax to directly govt. in this case how can we pass above entry
07 August 2014
Under reversecharge mechanism service provider will charge 12.36% of service tax only by company or LLP . . If other service provider charged complete 12.36% of service tax means you are not company or LLP . . Okay..if you are a company or llp but receied manpower charges bil including complet 12.36% of service tax from individual,firm . . As per reversecharge mechanism your legal liability is to pay 75% of service tax directly to dept. . So 1)Pay only 25% of service tax i.e, 3.09% of service tax to service provider 2)pay balance 75% of service tax directly to dept . 3)pass reverse entry for 75% of service tax which is in bill Dr.Service provider Cr.manpower charges
07 August 2014
Entries if bills are under RCM... . TDS IGNORED . Dr.manpower charges Dr.Service tax input(3.09% of service tax) Cr.service provider . .(as per invoice on date of invoice) Dr.Service tax defered input Cr.RCM Service tax payable (service tax payable as per RCM on date of invoice) . . Dr.RCM Service tax payable Cr.bankA/c (on payment of RCM Payable)
Dr.Service tax input Cr.Service tax defered input (Availed input on payment of RCM Service tax)
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