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Accounting in case of reverse charge under gst

Anurag Agrawal (Chartered Accountant) (27 Points)

16 July 2017

If we have to generate tax invoice in case we have to pay tax under reverse charge, then how we account for such invoice & how the expense should be booked.

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Sandeep Upadhyay (1518 Points)
Replied 16 July 2017

Reverse Charge Entries Under GST:

Entry for Purchase of Goods / Services Availed:

If purchases/services are availed within the state (Intra State)

Purchase / Expense A/c. ———10,000

Input CGST A/c. ——————- 900

Input SGST A/c. ——————- 900

To Creditors A/c. or Cash/Bank Ac —— 10,000

To CGST A/c Payable ———————–900

To SGST A/c Payable ———————–900

If purchases / services are availed from other state (Inter State)

Purchase / Expense A/c. ———10,000

Input IGST A/c. ——————– 1,800

To Creditors A/c. or Cash/Bank A/c. —— 10,000

To IGST A/c Payable ———————–1,800

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Anurag Agrawal (Chartered Accountant) (27 Points)
Replied 17 July 2017

Thats really helpful but I am concerned in cases where tax invoices are generated by the system itself which automatically post entries in that system. In those cases how should one generate tax invoice of reverse charge entries coz those should be treated as supply to overselves and it has to be included in GSTR 1 form i.e. outward supply.