Journal Entries to be passed in the books of account
| S. No. | Nature of Transactions | Entries to be passed | Remarks |
| 1 | Salary Expenses payable for the month
Without deduction of tax and pf
|
At the time of booking of entry
Salary A/c Dr. To Salary Payable (Being salary payable for the month of ……………………… to Mr. xxxxxxxxxxxxxx) At the time of payment Salary Payable A/c Dr. To Bank/Cash (Being salary paid into bank account for the month) |
Salary Account will be opened under the head of Indirect Expenses
Salary Payable Account will be opened under the head of current liability Preferably it should be through bank account as cash payment above Rs. 10000/- is not allowed as per section 40a(3) and the minimum wages is more than Rs. 10000 per month in almost all the states of the country. TDS from Salary has to be calculated/Deducted on monthly basis after considering his/her income on basis of various slabs of tax applicable. |
| 2 | With deduction of tds
|
At the time of booking of entry
Salary A/c Dr. To Salary Payable A/c To TDS Payable A/c (Being salary payable for the month of ……………………… to Mr. xxxxxxxxxxxxxx) At the time of payment Salary Payable A/c Dr. To Bank/Cash (Being salary paid into bank account for the month) At the time of payment of TDS TDS Payable A/c Dr. To Bank A/c (Being TDS paid for the month of……………….) |
Salary Account will be opened under the head of Indirect Expenses
Salary Payable Account will be opened under the head of current liability TDS Payable Account will be opened under the sub head of statutory dues under the head of current liability. Preferably it should be through bank account as cash payment above Rs. 10000/- is not allowed as per section 40a(3) and the minimum wages is more than Rs. 10000 per month in almost all the states of the country. TDS of each month has to be paid by 7th of the next month otherwise interest @ 1.5% per month. TDS from Salary has to be calculated/Deducted on monthly basis after considering his/her income on basis of various slabs of tax applicable. |
| 3 | With deduction of tds and applicability of pf/esi
|
At the time of booking of entry
Salary A/c Dr. PF Employer Contribution A/c Dr. ESI Employer Contribution A/c Dr. LWF Employer Contribution A/c Dr. To Salary Payable A/c To TDS Payable A/c To PF Payable A/c To ESI Payable A/c To LWF Payable A/c (Being salary payable for the month of ……………………… to Mr. xxxxxxxxxxxxxx) At the time of payment Salary Payable A/c Dr. To Bank/Cash (Being salary paid into bank account for the month) At the time of payment of TDS TDS Payable A/c Dr. To Bank A/c (Being TDS paid for the month of……………….) At the time of payment of PF/ESI PF/ESI Payable A/c Dr. To Bank A/c (Being TDS paid for the month of……………….)
|
Salary Account will be opened under the head of Indirect Expenses
Salary Payable Account will be opened under the head of current liability TDS Payable Account will be opened under the sub head of statutory dues under the head of current liability. PF/ESI Employer Contribution Account will be opened under the head indirect expenses as it is the extra amount spent by firm in addition to salary. PF/ESI Payable Account will be opened under the head of current liability and it will be credited by the total of both contribution employer as well as employee. Employee part will be deduction from his salary account. Preferably it should be through bank account as cash payment above Rs. 10000/- is not allowed as per section 40a(3) and the minimum wages is more than Rs. 10000 per month in almost all the states of the country. TDS of each month has to be paid by 7th of the next month otherwise interest @ 1.5% per month. TDS from Salary has to be calculated/Deducted on monthly basis after considering his/her income on basis of various slabs of tax applicable. |
| 4 | Commission Expenses Payable for the month
|
At Time of booking of Entry
Commission A/c Dr. GST Receivable A/c Dr. To Party A/c To TDS Payable A/c (Being Commission Payable to M/s…………….. against invoice no. of ………………M/s………………) At the time of payment Party A/c Dr. To Bank Account (Being amount paid to party against bill for the month of…….) At the time of payment of TDS TDS Payable A/c Dr. To Bank A/c (Being TDS paid for the month of……………….)
|
Commission Account will be opened under the head of Indirect Expenses.
GST Receivable Account will be opened either under the head Loans and Advances or under the sub head of Statutory Dues under the head Current Liability. Commission Payable will be routed through party account and party account will be opened under the sub-head sundry creditors of current liability. TDS Payable Account will be opened under the sub head of statutory dues under the head of current liability. TDS @ 5% from the basic value of bill (excluding GST ) will be deducted u/s 194 H and has to be deposited by 7th of the Next month otherwise interest @ 1.5% has to be paid. There is a limit of Rs. 10000/- per annum for deduction of tax under this head. |
| 5 | Professional Charges payable for the month
|
At Time of booking of Entry
Legal & Professional Exp. A/c Dr. GST Receivable A/c Dr. To Party A/c To TDS Payable A/c (Being misc. professional charges payable to M/s………………. vide invoice no…………..) At the time of payment Party A/c Dr. To Bank Account (Being amount paid to party against bill for the month of…….) At the time of payment of TDS TDS Payable A/c Dr. To Bank A/c (Being TDS paid for the month of……………….)
|
Legal & Professional Expenses Account will be opened under the head of Indirect Expenses.
GST Receivable Account will be opened either under the head Loans and Advances or under the sub head of Statutory Dues under the head Current Liability. Legal & Professional Expenses will be routed through party account and party account will be opened under the sub-head sundry creditors of current liability. TDS Payable Account will be opened under the sub head of statutory dues under the head of current liability. TDS @ 10% from the basic value of bill (excluding GST) will be deducted u/s 194 J and has to be deposited by 7th of the Next month otherwise interest @ 1.5% has to be paid. There is a limit of Rs. 30000/- per annum for deduction of tax under this head |
| 5 | Various other heads of Expenses falling within the definition of contractual services
|
At Time of booking of Entry
Name of Expenses A/c Dr. GST Receivable A/c Dr. To Party A/c To TDS Payable A/c (Being expenses payable to M/s………………. vide invoice no…………..) At the time of payment Party A/c Dr. To Bank Account (Being amount paid to party against bill for the month of…….) At the time of payment of TDS TDS Payable A/c Dr. To Bank A/c (Being TDS paid for the month of……………….)
|
Name of Expenses Account will be opened under the head of Indirect Expenses.
GST Receivable Account will be opened either under the head Loans and Advances or under the sub head of Statutory Dues under the head Current Liability. Name of Expenses Expenses will be routed through party account and party account will be opened under the sub-head sundry creditors of current liability. TDS Payable Account will be opened under the sub head of statutory dues under the head of current liability. TDS @ 2/1% from the basic value of bill (excluding GST) will be deducted u/s 194 C depending upon the structure of the payee viz. company or individual respectively and has to be deposited by 7th of the Next month otherwise interest @ 1.5% has to be paid. There is a limit of Rs. 100000/- per annum (subject to each bill below the basic value of Rs. 30000/) for deduction of tax under this head |
| 6 | Purchase of Materials | At the time of purchase of materials and its booking
Purchase A/c Dr. GST Receivable A/c Dr. To Party A/c (Being material purchased from M/s……………. vide invoice no……………) At the time of payment Party A/c Dr. To Bank Account (Being amount paid to party against bill for the month of…….)
|
Purchase Account to be created under the under purchase
GST Receivable Account will be opened either under the head Loans and Advances or under the sub head of Statutory Dues under the head Current Liability. Payment will be routed through party account and party account will be opened under the sub-head sundry creditors of current liability.
|
| 7 | Sales of Materials/Services | At the time of Sales of materials/Services
Party A/c Dr. To Sales/Services A/c To GST Payable A/c (Being material/Services sold/provided vide invoice no……………) At the time of receipt of payment in case of material sale Bank A/c Dr. To Party A/c To GST Payable A/c (Being amount received from party against invoice no………..) At the time of receipt of payment in case of Service Sale Bank A/c Dr. TDS A/c Dr. To Party A/c (Being amount received from party against invoice no……….. after deduction of TDS)
|
Sales Account to be created under the under sales head
GST Payable Account will be opened under the sub head of Statutory Dues under the head Current Liability. Payment will be routed through party account and party account will be opened under the sub-head sundry Debtors of Current Assets.
|
Leave a Reply