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Former Member

Calculate tax in Vendor Down Payment

Hi,

While posting down payment to my service vendor including service tax amount in F-48 after tick the calculate tax also, it is not asking for tax code and it is not showing service tax seperately. Only vendor a/c and bank a/c's are simulating. Please tell me how to calculate tax while doing vendor down payment.

Regards,

Prasad

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1 Answer

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    Former Member
    Aug 16, 2007 at 11:30 AM

    Hi,

    Service tax is calculated and deducted from the invoice of service and not on Advance payment.

    On Advance payment, there will be basic tax, surcharge, education cess and / or secondary higher education cess.

    Hope this helps, if yes, please assign points.

    Regards,

    Harish

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    • Former Member Former Member

      Hi,

      Small change in the accounting:

      Dr. Expense

      Cr. Withholding Tax

      Cr. Vendor

      If the service tax is modvateable, then the entry will be as follows:

      Dr. Expense

      Dr. Service Tax (Modvat)

      Cr. Withholding Tax

      Cr. Vendor

      Hope this helps, if yes, please assign points.

      Regards,

      Harish