Hello Friends, I dont know weather i have to submit this query in TDS or GST forum. my query is one of the Debtors instead of making a payment of GST they have adjusted the amount in TDS, so in this case what entry on e has to be passed and what entry will be passed in case of advance received.
1 Replies
Pranjal Gupta
(141 Points)
Replied 13 June 2023
When a debtor adjusts the amount of GST payable by offsetting it against TDS (Tax Deducted at Source), it affects the accounting entries for both GST and TDS. Let's examine the entries that need to be passed in such cases:
- Adjusting GST against TDS:
In this scenario, where the debtor adjusts the GST liability by offsetting it against TDS, the following entries need to be passed:
a) For GST Adjustment:
- Debit: TDS Receivable (Asset Account)
- Credit: GST Payable (Liability Account)
b) For TDS Adjustment:
- Debit: TDS Payable (Liability Account)
- Credit: Accounts Receivable (Debtors Account)
These entries reflect the adjustment made by reducing the GST payable amount and increasing the TDS receivable amount.
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