VIJAY G (Assistant Manager -Accounts) (53 Points)
08 October 2015Plz can anyone clarify me the doubt of Service tax reverse charge mecahnism payment . Mine is a company registered
For Example : if my Security agency has given me a bill to me for Rs.10,000/- p.month
1.what will be the Journal entry i need to book for the expenses and payment with amount ?
2. Tell me the service tax liability entry need to be posted and remit to Govt ?
Shubham Bansal
(Student CA)
(62 Points)
Replied 08 October 2015
For booking of expense:
Security expense Dr. 10,000
Service Tax Credit Dr. 1,400
To Security Agency 10,000
To Reverse charge payable 1,400
For payment of tax:
Reverse charge payable Dr. 1,400
To Bank 1,400
Piyush Tanwar
(Assistant Manager - Accounts)
(1432 Points)
Replied 08 October 2015
For Booking of expenses:- (Assuming inclusive of service tax)
Security Expenses A/c - Dr 10000
To Security Agency or Bank A/c 8772
To Service Tax Pybl on Reverse Charge - Manpower 1228
Credit of service tax paid on reverse charge can be availed only in the month following the month of payment of tax
sajjad hossain
(CONSULTANT)
(50 Points)
Replied 08 October 2015
Your company is registered company.Now you will have to see wheather the agency is Indivdual/HUF/Partnership OR a registered pvt ltd co.If it is not a registered company
no reverse mechanism is applicable in your case.You will have to deposit all the service
Tax (100%) on your own.If the Agency is a limited co.then pay the service tax to the agency and the agency will deposit the tax on your behalf.
and the journal is ( If ST is paid to Agency )
Watch and Ward Exp Dr 8772
Service Tax Input Dr 1228
To Security Agency 100000
Hari Venkata Ramana
(General Manager Accounts)
(26 Points)
Replied 08 October 2015
| IN CASE OF A COMPANY(PROVIDER) | |||
| VENDOR AC | CR | 9800 | |
| TDS PAYABLE | CR | 200 | |
| SECURITY SERVICES | DR | 10000 | |
| IN CASE OF OTHERS(PROVIDER) | |||
| SECURITY EXPS A/C | DR | 10000 | |
| SERVICE TAX EXPS A/C | DR | 1400 | |
| SERVICE TAX LIABILITY A/C | CR | 1400 | |
| TDS ON CONTRACTORS | CR | 200 | |
| VENDOR A/C | CR | 9800 | |
| PAYMENT | |||
| SERVICE TAX LIABILITY A/C | DR | 1400 | |
| BANK ACCOUNT | CR | 1400 | |
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